Managing Road Capacity: Maintenance, Tolls, and Multi-Level Governance

André De palma ()
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André De palma: CY Cergy Paris Université, THEMA

No 2025-14, THEMA Working Papers from THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise

Abstract: Road congestion and deteriorating infrastructure impose substantial economic and social costs, with estimates reaching up to 1% of GDP in highly congested economies. At the same time, public finances are increasingly constrained, and reliance on the “user-pays” principle has grown, prompting greater use of tolling schemes and private participation in financing, operating, and maintaining road networks. This paper examines the interaction between road maintenance, capacity, and pricing decisions in contexts where different operators share responsibilities. We analyze whether private maintenance and tolling strategies converge toward socially optimal outcomes, and under what conditions misalignments occur. Policy implications for optimal pricing, investment incentives, and the design of capacity and maintenance are discussed.

Keywords: Road maintenance; Road capacity; Traffic congestion; Tolls; Perfect Competition; Multi-level governance; Infrastructure finance (search for similar items in EconPapers)
JEL-codes: H54 L91 Q54 R41 R42 R48 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ema:worpap:2025-14

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