Socially optimal transport prices and markets: principles, strategies and impacts

This paper investigates the level of mobility that is socially optimal, that is, the amount and mix of transport activity that consumers would choose in an efficient market that reflects the principles of efficient pricing, consumer options and optimal planning. It discusses market principles, identifies transport market distortions and ways to correct them, estimates how such reforms would affect mobility, and investigates the resulting economic impacts. This analysis indicates that in a more optimal market, consumers would choose to drive significantly less, use alternative modes more, choose more accessible land use options, and be significantly better off overall as a result. Transport market reforms face various obstacles but these can be minimized through appropriate implementation. Although previous studies have evaluated individual transport market distortions and reforms, this is one of few that considers their cumulative impacts.