Abstract
This paper performs an ex-post cost–benefit and distribution analysis of the Gothenburg congestion charges introduced in 2013, based on observed effects and an ex-post evaluated transport model. Although Gothenburg is a small city with congestion limited to the highway junctions, the congestion charge scheme is socially beneficial, generating a net surplus of €20 million per year. From a financial perspective, the investment cost was repaid in slightly more than a year and, from a social surplus perspective, is repaid in < 4 years. Still, the sums that are redistributed in Gothenburg are substantially larger than the net benefit. In the distribution analysis we develop an alternative welfare rule, where the utility is translated to money by dividing the utility by the average marginal utility of money, thereby avoiding putting a higher weight on high-income people. The alternative welfare rule shows larger re-distribution effects, because paying charges is more painful for low-income classes due to the higher marginal utility of money. Low-income citizens pay a larger share of their income because all income classes are highly car dependent in Gothenburg and workers in the highest income class have considerably higher access to company cars for private trips. No correlation was found between voting pattern and gains, losses or net gain.
Highlights
IntroductionCongestion pricing has proven to be an effective policy for reducing congestion and increasing welfare, but is still only implemented in a few cities: Singapore (Olszewski and Xie 2005; Phang and Toh 1997), London (Santos 2002; Santos and Shaffer 2004)
Congestion pricing has proven to be an effective policy for reducing congestion and increasing welfare, but is still only implemented in a few cities: Singapore (Olszewski and Xie 2005; Phang and Toh 1997), London (Santos 2002; Santos and Shaffer 2004) SwedenTransportation (2020) 47:145–174Stockholm (Borjesson et al 2012; Eliasson 2009) and Milan (Carnovale and Gibson 2013)
Gothenburg is a small city with congestion limited to the highway junctions, the congestion charge scheme is socially beneficial, generating a net surplus of €20 million per year
Summary
Congestion pricing has proven to be an effective policy for reducing congestion and increasing welfare, but is still only implemented in a few cities: Singapore (Olszewski and Xie 2005; Phang and Toh 1997), London (Santos 2002; Santos and Shaffer 2004). Another possibility is that the route choice is influenced by attributes not represented in the network model that are correlating with travel time, such as the preference for larger arterials rather than smaller streets due to comfort, for instance For this reason, we apply the original, not stretched, value of time distribution by trip purpose in the welfare calculation in ‘‘Consumer surplus’’ section. In Gothenburg crowding in the public transport system is a minor problem, so one could argue that additional public transport supply to reduce crowding was not required (the share of buses and commuting trains where anyone had to stand up was less than three per cent in 2013 (Bjorklind et al 2014)) For this reason, we assume that the increase in operating costs for the public transport producer is entirely covered by the additional fare revenues from new travellers (on average fare revenues cover approximately 50% of the operating costs). The share of the investment cost of the package that is covered by the revenue from the congestion charges should not be multiplied by the MCPF in the CBA of the investment package
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