caa a22 4500 378899007 CHVBK 20200325081032.0 cr unu---uuuuu 161128e20040313xx s 000 0 eng 10.2202/1538-0653.1246 doi (NATIONALLICENCE)gruyter-10.2202/1538-0653.1246 Toll Competition Among Congested Roads [Elektronische Daten] [Eduardo M Engel, Ronald Fischer, Alexander Galetovic] Roads are being franchised to private firms in many countries, raising the issue of regulating the tolls they charge. When there is more than one road to get from one point to another, regulation need not be necessary, since competition may substitute for toll regulation. This paper studies toll competition among private asymmetric roads subject to congestion. We obtain two main results. First, in equilibrium tolls are higher than optimal, that is, there is too little congestion. This happens because road owners internalize the reduction in drivers' willingness to pay due to congestion, thereby softening competition. It follows that the drawback of private competition is exercise of market power, not excessive congestion as is sometimes conjectured. Second, the distortion becomes smaller as market size and the number of roads grow, even if the density of drivers does not change. In the limit tolls converge to the socially optimal level and are just enough to make each driver internalize the congestion externality. This suggests that the scope for competition is better in larger networks. ©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston Private toll roads nationallicence congestion nationallicence competition nationallicence Engel Eduardo M. Yale University, eduardo.engel@yale.edu aut Fischer Ronald Universidad de Chile, rfischer@dii.uchile.cl aut Galetovic Alexander Universidad de Chile, agaleto@dii.uchile.cl aut Topics in Economic Analysis & Policy De Gruyter 4/1(2004-03-13) 4:1 2004 4 bejeap https://doi.org/10.2202/1538-0653.1246 text/html Onlinezugriff via DOI 1 research article jats NATIONALLICENCE 856 40 https://doi.org/10.2202/1538-0653.1246 text/html Onlinezugriff via DOI NATIONALLICENCE 700 1- Engel Eduardo M. Yale University, eduardo.engel@yale.edu aut NATIONALLICENCE 700 1- Fischer Ronald Universidad de Chile, rfischer@dii.uchile.cl aut NATIONALLICENCE 700 1- Galetovic Alexander Universidad de Chile, agaleto@dii.uchile.cl aut NATIONALLICENCE 773 0- Topics in Economic Analysis & Policy De Gruyter 4/1(2004-03-13) 4:1 2004 4 bejeap CC0 http://creativecommons.org/publicdomain/zero/1.0 nationallicence SWISSBIB 378899007 BK010053 XK010053 XK010000 NATIONALLICENCE NATIONALLICENCE NL-gruyter