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Cost-benefit analysis of transport improvements in the presence of spillovers, matching and an income tax

Jonas Eliasson () and Mogens Fosgerau

No 2017:3, Working papers in Transport Economics from CTS - Centre for Transport Studies Stockholm (KTH and VTI)

Abstract: This paper addresses the problem of measuring the welfare benefits of a transport improvement. We formulate and analyze a rich spatial model that allows for spillovers, matching and income tax, in a setting with multiple work and residential locations and very general worker heterogeneity. The conventional consumer surplus captures part of the benefits and is calculated based on predictions of changes in travel demand and transport costs. The issue is to determine which socalled wider impacts to add to this. We find that adding the change in total output as a wider impact leads to doublecounting of benefits. The output change due to spillovers should be added, while the output change due to matching is already partly included in the consumer surplus. These results are useful for applied costbenefit analysis of transport policies.

Keywords: Agglomeration; Spillovers; Matching; Cost benefit analysis; Transport policy. (search for similar items in EconPapers)
JEL-codes: R40 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2017-02-07
New Economics Papers: this item is included in nep-geo, nep-tre and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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http://www.transportportal.se/swopec/CTS2017-3.pdf (application/pdf)

Related works:
Journal Article: Cost-benefit analysis of transport improvements in the presence of spillovers, matching and an income tax (2019) Downloads
Working Paper: Cost-benefit analysis of transport improvements in the presence of spillovers, matching and an income tax (2017) Downloads
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