As an economist, don't you hate it when a policy that should so obviously be enacted is either perverted by special interests in the legislative process or immediately dismissed as politically unfeasible? The problem is often that politicians are economic laymen yet believe that they know best. Or they do not think about the common good. Anyway, congestion pricing is one policy that makes perfect sense to an economist, but that is often rejected by policy makers because it would be unpopular. And this despite the success of the congestion charge in London. Why this negative attitude?
Bruno De Borger and Stef Proost look at the political economy of congestion pricing. They observe that in the successful cases, revenue was used for public transportation. Also, there was a majority opposed ex-ante, but no majority to revert ex-post. De Borger and Proost claim this is consistent with people being uncertain about outcomes, which means they would also be against experiments. Thus, I conclude that politician need to show leadership and impose congestion pricing.
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