2007 Annual Forum
Evaluating Congestion Pricing Impacts Under Peak Spreading
Pierre Vilain, The Louis Berger Group
Carolyn Wolff, The Louis Berger Group
The paper involves an econometric analysis of congestion pricing at the bridges and tunnels operated by the Port Authority of New York and New Jersey (PANYNJ). Using a fixed effects model, we pool all facilities to evaluate the impacts of the congestion pricing structure in effect since March 2001. We find significant impacts for autos, but need to confront a counter-intuitive finding: cash paying vehicles, who do not benefits from off-peak discounts, are also estimated to be impacted. Using a unique data set on queueing at the facilities, we are able to control for "peak spreading", and find the pricing effect greatly reduced. By further controlling for endogeneity with an instrumental variables estimator, we find that the price effect on cash paying vehicles entirely disappears.
These results confirm the hypothesis that congestion pricing has had an important impact on conditions at the PANYNJ facilities. Taking a weighted average of the changes by crossing for autos, it is estimated that value pricing led to a shift in EZ-Pass-using vehicles from the morning peak equal to 6.5% and in the evening peak 2.2%. Note that this result is heavily influenced by patterns at the George Washington Bridge, which accounts for over 50 percent of EZ-Pass-using autos.