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RESOURCE PAPER
Then and Now
The Evolution of Congestion Pricing in Transportation and
Where We Stand Today
Martin Wachs, Institute of Transportation Studies, University of California, Berkeley
T
he proposition that roads should be priced in elected officials, but the concept has survived and has been
part to manage congestion by influencing traffic tested in a number of applications despite widespread
flows is not a new one. References to the con- doubts. A decade ago I thought the odds were against
cept have appeared in the scholarly literature for at achieving road pricing on a large scale, but today I am far
least 83 years. But, like many good ideas in the realm of more optimistic, and the reasons are the organizing theme
public policy, it has taken quite a while to catch on. The for my presentation.
views of scholars do sometimes influence public policy,
but only after being shaped by policy makers and opin-
ion leaders do they ultimately make their influence felt. EVOLUTION OF ARGUMENTS FOR CONGESTION
The question we are here to explore is whether road PRICING IN THE UNITED STATES
pricing has finally entered or is about to enter the main-
stream of transportation policy. We will do this at an Congestion pricing was, to my knowledge, first sug-
international conference because the history of trans- gested by economist A. C. Pigou in 1920. His words are
port policy, the nature of road pricing, and the response reproduced in the accompanying Box 1. Pigou's concept
to experiments with congestion pricing are sensitive to was amplified by economist Frank Knight in 1924, in a
the contexts in which they have been discussed and passage also reproduced in the box. The language used
attempted, so there is much to learn through compari- by these two distinguished economists is not terribly dif-
son. Over the coming few days we will hopefully learn ferent from that used in later years by such well-known
from and teach one another by analyzing how history advocates for congestion pricing as Nobel laureate
and current experiments in many places interact with William Vickrey in the 1960s and 1970s.
and depend on their physical, social, economic, and It would be a mistake to interpret these early sugges-
political environments. tions as a quaint historical footnote that was of limited
I believe our deliberations and case studies will con- relevance to the political debates about transportation
vince us that road pricing is not quite yet within the main- that were current when they were written. In the early
stream of transportation policy options but that more 1920s, in both the United States and Europe, automo-
progress has been made in that direction in the last decade bile ownership and the use of motor trucks were grow-
than had been made in the preceding 70 years. Road pric- ing at more rapid rates than at any time before or since.
ing is at a critical juncture in North America today. It While the provision of roads had for many centuries
remains fragile, yet it is poised to be adopted on a much been a responsibility of local communities, the dramatic
broader scale than would have seemed feasible only a growth of automobile and truck travel in the early
decade ago. There is still a great deal of skepticism and 1920s was causing much greater traffic between com-
some overt opposition on the part of policy makers and munities, and the emphasis in transport policy making
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