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End Traffic By Raising Prices

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Charles Wheelan, a new columnist at Yahoo! Finance, suggests raising the price of driving (through the costs of gas and tolls) in order to eliminate traffic congestion.

The future of transportation will look a lot like the I-15 FastTrak in San Diego. This expressway has free lanes and HOT (High-Occupancy/Toll) lanes that run parallel. Here’s the twist: The price of the HOT lanes fluctuates between $.50 and $4.00 depending on traffic conditions. Carpools use the HOT lanes free at all times.

Your toll for the HOT lanes guarantees a “free flowing” speed of travel. If the HOT lanes begin to get congested, the toll will rise immediately, prompting more drivers to choose the free lanes rather than the HOT lanes. (The toll at any given time is advertised on electronic signs on the side of the road.)

There is a drawback to congestion pricing: The HOT lanes are sometimes referred to as “Lexus lanes” because those with deep pockets care less about $4 than those who are counting their pennies. But don’t assume automatically that congestion pricing is bad for people lower on the economic ladder. If a plumber’s assistant earning $14 an hour shows up for work half an hour late, he gets docked $7. Or, he can get there on time by using the HOT lanes–with a maximum toll of $4.00. Do the math.

An economist sees traffic as a problem of money. An engineer sees congestion as an infrastructure issue. Commuters view congestion as a societal design problem. Environmentalists and others have even more differing views.

Updated February 6, 2012 and originally published October 5, 2005. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes, also known as Flexo, is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about him and follow Luke Landes on Twitter. View all articles by .

{ 2 comments }

avatar Prosperette

Your post here on traffic inspired my own! This reminds me of the Coca-Cola experiment — the ah-hem, brilliant idea of remotely increasing the vending machine price of Coke in proportion to the rise in outdoor temperature (proxy for demand).

Please visit my blog http://prosperette.blogspot.com for an argument against our friend the economist! And color me a member of the Societal Decline club :)

avatar Prosperette

Whoopsie.

Design… I’m a member of the societal DESIGN club. Typo.

Sure, traffic is a mess but societal decline is a little harsh. Even for me.

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