Welfare Losses of Road Congestion

Antonio Russo, Martin W. Adler, Federica Liberini and Jos van Ommeren ()

No 7693, CESifo Working Paper Series from CESifo

Abstract: We estimate the marginal external congestion cost of motor-vehicle travel for Rome, Italy, using a methodology that accounts for hypercongestion (a situation where congestion decreases a road’s throughput). We show that the external cost – even when roads are not hypercongested – is substantial, equaling about two thirds of the private (time) cost of travel. About one third of this cost is borne by public transport users. Most roads are never hypercongested, but some are hypercongested for more than one hour per day. Hypercongestion accounts for about 40 percent of congestion-related welfare losses. Welfare losses incurred on roads that are hypercongested are substantial, predominantly because of a reduction in speed rather than throughput. Our results suggest policies that reduce congestion can result in important welfare gains.

Keywords: marginal external congestion cost; deadweight loss; hypercongestion; public transport (search for similar items in EconPapers)
JEL-codes: D62 H23 R41 (search for similar items in EconPapers)
Date: 2019
New Economics Papers: this item is included in nep-pub, nep-reg, nep-tre and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_7693

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