The Welfare Effects of Congestion-Reduction Policies

交通拥堵缓解政策的福利效应分析

Date: May 12, 2022 (Thu)

Time: 3:30 pm - 5:00 pm (GMT+8)

Zoom ID: 944 9709 3068

Pass code: UGOD

Language: English

ABSTRACT

Traffic congestion and air pollution are pressing challenges facing middle-income countries.  Lost time due to congestion negatively impacts growth while air pollution adversely affects public health.  To address this issue, governments have pursued a host of policies including driving restrictions, public transit fare reductions, and subway expansions. However, there is limited empirical evidence regarding the relative effectiveness and efficiency of such policies in developing country settings.  

In this paper, I estimate the welfare effects of various congestion-reduction policies for Beijing, which has some of the world’s worst pollution and congestion problems.  Specifically, I compile a detailed dataset which allows me to recover individuals' full transportation mode choice sets. I then leverage this information in a discrete choice framework to estimate consumer preferences for travel time and cost; to examine the substitution patterns among different travel modes; and to generate counterfactual simulations for travel demand, mode choice and consumer welfare under alternative transportation policies.  

My estimates suggest that the elasticity of driving with respect to travel cost is 0.03, a substantially more inelastic response than found in the prior literature.  In addition, my simulations show that the driving restriction has had a larger impact on improving the average travel speed than other traffic congestion policies (existing or proposed), resulting in reducing cost of congestion by 17 billion yuan, or 2.6 billion dollars. Based on my model, a regulator wishing to achieve the same goal of the average speed of 42km/h could subsidize public transit by 26.7 yuan per ride; restrict 3 out of 100 drivers on the road; charge  26.3 yuan within the 3rd ring road as a cordon toll; or impose road pricing of 0.46 yuan per kilometer.

SPEAKER

Dr. Avral-Od Purevjav is a Postdoctoral Fellow at University of Bern. His interests include environmental and energy economics, urban and transportation economics, and applied microeconomics in general. His current research focuses on understanding the effectiveness of environmental and transportation policies in addressing environmental pollution and traffic congestion in developing countries. For more information, please visit his website at https://www.avraltodpurevjav.com/research.html

Organizer

This seminar is held by the Urban Governance and Design Thrust, one of the Thrusts under the Society Hub, HKUST(Guangzhou). It aims to train the next generation of leaders in conducting cutting-edging innovative research on cities through cross-disciplinary approaches to solve complex urban problems.

The cross-disciplinary areas we now focus are:

• Education, Employment and Labor Markets
• Migration, Inequality, and Social Inclusion
• Population, Health, and Ageing
• Regional and Urban Economic Development
• GIS and Spatial Analysis
• Smart City
• Transportation and Communication Infrastructure