| dc.description.abstract | Congestion pricing has long been viewed as a viable strategy to mitigate externalities generated in traffic (Walters, 1961),(Pigou, 1924), but is yet to be widely implemented. For several reasons, it is a politically contested policy area. Thus, having information on the economic consequences of introducing a congestion pricing scheme may be important for the ongoing debate. This thesis seeks to estimate the economic consequences of introducing congestion pricing. To do this, I develop a pricing rule based on a paper by Johansson (1997) applied to multiple periods with heterogeneous users, and integrate it in a model where road users and the government interacts. Using the model formulation, I derive a system of equations which enables me to compute the optimal traffic flow and congestion toll, using data from a single road link in the Oslo cordon. The equation system is parameterized by estimating external cost functions and elasiticities with respect to tolls and generalized costs by econometric models. It is solved by an iterative algorithm called fixed-point iteration.Combining the estimated models for external costs and parameters, I estimate the change in social surplus from introducing congestion pricing, as compared to the present situation with no congestion pricing. I use a road link on E18 Lysaker-Sandvika, direction towards Oslo, as an application/case study. My results indicate a positive effect on the social surplus from introduction of congestion pricing. They further seem robust to some of the model assumptions, and the estimates are likely to be conservative. A caveat in the estimation is that I am not able to estimate optimal tolls during rush hours, due to data limitations and features of demand during that period. This does not, however, alter my main conclusion. | en_US |