Private Operators and Time-of-Day Tolling on a Congested Road Network

Congestion pricing by public and private toll road operators is compared using METROPOLIS: the first fully dynamic traffic simulator that treats transport mode, departure time and route choices endogenously. Toll scenarios are defined by what is tolled (traffic lanes, roads or areas) and whether tolls vary over time. The distortion caused by exercise of market power by a private operator is not systematically related to the amount of road capacity that is tolled. A third-best tolling scheme in which tolls are varied in steps to eliminate queuing performs favourably compared to public step tolling and better than private tolling. © 2008 LSE and the University of Bath