Road Pricing Increases Sprawl But Won’t Increase Congestion Either

Economist Alex Anas of the State University of New York at Buffalo has an interesting powerpoint presentation on the effects of tolling and road pricing on urban form. The presentation was given in Toronto in 2010 and reports the results from his working paper on the same topic. It’s worth taking a few minutes to browse.

In short, he finds that an increase in the gas tax and network wide tolling have about the same effect on congestion, although the gas tax tends to concentrate jobs in the Central Business District. Importantly, a cordon charge similar to London’s congestion charge increases sprawl by encouraging jobs to decentralize to suburban areas. Rising congestion, generally, tends to increase suburbanization because jobs tend to move out to workers, not the other way around. But this increased suburbanization doesn’t increase congestion because more jobs move closer to workers, shortening commuting trips. The exceptions might be in cities with large public transport systems like Chicago or New York, where low out of pocket costs allow workers to have access to central city jobs (even though commute times might increase) as congestion increases.

In short, Anas’s presentation (and research more generally) is a very nuanced way of looking at these interactions and well worth understanding more completely.

Samuel R. Staley, Ph.D. is a senior research fellow at Reason Foundation and managing director of the DeVoe L. Moore Center at Florida State University in Tallahassee where he teaches graduate and undergraduate courses in urban planning, regulation, and urban economics. Prior to joining Florida State, Staley was director of urban growth and land-use policy for Reason Foundation where he helped establish its urban policy program in 1997.