When Are Anonymous Congestion Charges Consistent with Marginal Cost Pricing? / Richard Arnott, Marvin Kraus.

By:

Arnott, Richard

Contributor(s):

Material type: Text

TextSeries: Technical Working Paper Series (National Bureau of Economic Research) ; no. t0154.Publication details: Cambridge, Mass. National Bureau of Economic Research 1994.Description: 1 online resource: illustrations (black and white)Subject(s):

H2 - Taxation, Subsidies, and Revenue

Online resources:

Available additional physical forms:

Hardcopy version available to institutional subscribers

Abstract: There are constraints on pricing congestible facilities. First, if heterogeneous users are observationally indistinguishable, then congestion charges must be anonymous. Second, the time variation of congestion charges may be constrained. Do these constraints undermine the feasibility of marginal cost pricing, and hence the applicability of the first-best theory of congestible facilities? We show that if heterogeneous users behave identically when using the congestible facility and if the time variation of congestion charges is unconstrained, then marginal cost pricing is feasible with anonymous congestion charges. If, however, the time variation of congestion charges is constrained, optimal pricing with anonymous congestion charges entails Ramsey pricing.

Tags from this library: No tags from this library for this title. Log in to add tags.

Average rating: 0.0 (0 votes)

Holdings
Item type	Home library	Collection	Call number	Status	Date due	Barcode	Item holds
Working Paper	Biblioteca Digital	Colección NBER	nber t0154 (Browse shelf(Opens below))	Not For Loan

Total holds: 0

Collection: Colección NBER Close shelf browser (Hides shelf browser)

Previous	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	Next
Previous	nber t0151 Instrumental Variables Regression with Weak Instruments /	nber t0152 The Predictive Ability of Several Models of Exchange Rate Volatility /	nber t0153 Assessing Specification Errors in Stochastic Discount Factor Models /	nber t0154 When Are Anonymous Congestion Charges Consistent with Marginal Cost Pricing? /	nber t0155 Small Sample Properties of Generalized Method of Moments Based Wald Tests /	nber t0156 Small Sample Bias in GMM Estimation of Covariance Structures /	nber t0157 Econometric Mixture Models and More General Models for Unobservables in Duration Analysis /	Next

April 1994.

There are constraints on pricing congestible facilities. First, if heterogeneous users are observationally indistinguishable, then congestion charges must be anonymous. Second, the time variation of congestion charges may be constrained. Do these constraints undermine the feasibility of marginal cost pricing, and hence the applicability of the first-best theory of congestible facilities? We show that if heterogeneous users behave identically when using the congestible facility and if the time variation of congestion charges is unconstrained, then marginal cost pricing is feasible with anonymous congestion charges. If, however, the time variation of congestion charges is constrained, optimal pricing with anonymous congestion charges entails Ramsey pricing.