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2006-02-01 | Peer Reviewed

Optimal environmental road pricing

Johansson-Stenman, Olof. 2006. “Optimal environmental road pricing.” Economics Letters 90:2: 225-229.
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An optimal first-best road charge should not only be differentiated with respect to factors that affect the direct external environmental and time costs from the road-user himself.

Indirect effects, such as the fact that others’ cars will be more polluting when congestion increases, should also be taken into account.