Parking%20Taxes%20as%20a%20Second%20Best%20Congestion%0D%0APricing%20Mechanism

Working Papers

Parking Taxes as a Second Best Congestion Pricing Mechanism


CODE: IDB-WP-614
AUTHOR(s): Miller, Sebastian , Wilson, Riley
PUBLISHED: October 2015
LANGUAGE: English
RELATED TOPICS: Microeconomics
DOWNLOAD FILE IN: English

Abstract:

Growing vehicle use and congestion externalities have led many to consider alternative congestion pricing mechanisms, as road pricing often has high infrastructural costs and faces public opposition. This paper explores the role of parking taxation in reducing congestion by considering a natural experiment created by the progressive January 1, 2012 Chicago parking tax increase. Exploiting differences in vehicle use across income groups, it is estimated that the approximately $2 a day parking tax increase led to a 4-6 percent reduction in total vehicle trips in high-income areas, with the largest response seen on roads more heavily used by commuters. Also found are corresponding increases in use of public transit and a 3.1 percent aggregate reduction in vehicle trips. It is concluded that parking taxes can help mitigate congestion externalities, although they are no more than about half as effective as more efficient congestion tolls.

Related Research by JEL Codes:
(or click here to find research by JEL Codes)
  • Pollution or Crime: The Effect of Driving Restrictions on Criminal Activity
    Working Papers
    IDB-WP-698 - July 2016

    Driving restriction programs have been implemented in many cities around the world to alleviate pollution and congestion problems. Enforcement of such programs is costly and can potentially displace policing resources used for crime prevention and crime detection. Hence, driving restrictions may increase crime. To test this hypothesis, this paper exploits both temporal and spatial variation in ... (View publication)

  • The Effects of Air Pollution on Educational Outcomes: Evidence from Chile
    Working Papers
    IDB-WP-468 - December 2013

    In addition to the morbidity and mortality concerns of outdoor air pollution, studies have shown that air pollution also generates problems for children`s cognitive performance and human capital formation. High concentrations of pollutants can affect children’s learning process by exacerbating respiratory illnesses, fatigue, absenteeism and attention problems. The purpose of this work is to analyz ... (View publication)

  • Are Environmentally Related Taxes Effective?
    Working Papers
    IDB-WP-467 - November 2013

    This paper focuses on the question of whether the magnitude of long-established environmentally related taxes (ERT) is related to countries environmental performance. While environmental taxes efficiencies have previously been discussed, those taxes contribution to reducing pollution and improving environmental quality has not been fully explored. This paper therefore analyzes the effectiveness of ... (View publication)

Hello, Welcome to the IDB!

Please join our mailing list by simply entering your email below.