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Do Traffic Congestion Fees Work?

UK drivers owe $270 million in outstanding fees for entering central London on weekdays; should the U.S. adopt a similar system?

By Claire_Martin Jul 10, 2012 1:51PM
In an effort to manage London's traffic problem, cameras were installed in 2003 to help enforce a law banning drivers from entering the city between 7 a.m. and 6 p.m. on weekdays. But each year, tens of thousands of violators fail to pay the resulting $15 fine, and now British drivers are collectively $270 million in arrears in congestion fees. 

The city has collected $3.7 billion from the program over the years, so the majority of errant drivers do pay up. But the payment gap raises the question of whether the program is effective. And should other cities implement similar penalties? 

The answer: Maybe not. Researchers at Stanford University say incentive programs are far more effective in managing traffic. Stanford's computer science department recently conducted a study wherein drivers to the school's notoriously traffic-filled campus were allowed to enter a daily lottery if they agreed to commute at off-peak times. The prize they were vying for: $50. According to The New York Times, the program has been wildly successful, and it even spawned another lottery to encourage drivers to park farther from the campus' busiest parking structures.

"[C]arrots, as opposed to sticks, frequently work very well,” UC Berkeley transportation expert Pravin Varaiya told The New York Times. But critics are skeptical that the Stanford system could work on a larger scale in cities like London or New York. They say that, on a mass scale, big disincentives (fines) are more effective than small carrots.

The debate will be settled soon enough. Singapore has been testing out the incentive program in its public transportation system since January. So far, it's working. Offering riders a fare discount if they travel at off-peak times has lowered ridership by 10 percent.

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