Econ 366 Notes (11.03.2008)

Econ 366 Notes (11.03.2008) - Correction: “toll tax equal...

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Econ 366 Lecture Notes 11/3/2008 *Demand for Transportation Terms: residential collection, line haul, workplace distribution (transportation from home to work) - Residential collection: Walk from residence to station or bus stop. - Line haul: Major part of the transportation. - Workplace distribution: Walk from station/bus stop to work. Probability that person will choose a certain mode depends on: 1) income, 2) price, and 3) time cost *Congestion and Pricing It is optimal to have congestion in the expensive areas People tend to overuse roads (use to the point where it’s not socially efficient) If average cost is rising, then marginal cost > average cost
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Unformatted text preview: Correction: “toll tax equal to MC(T1) – AC(T1)…”-Some crowding in CBD is optimal because land is expensive We want to avoid too much crowding (congesting) *Long run issues Midterm #2 will cover up to the Demand for Transportation Correction: “Long Run Issues” slide the lower part of the bracket should be one line up *Spatial Variations Optimum toll is greater where land is more expensive. Optimum toll is higher in the central city compared to the suburbs. *Tolls Tollbooth Automatic Vehicle Identification Time of day pricing for urban travelers Econ 366 Lecture Notes 11/3/2008...
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This note was uploaded on 09/26/2009 for the course ECON 366 taught by Professor Sengupta during the Fall '08 term at USC.

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Econ 366 Notes (11.03.2008) - Correction: “toll tax equal...

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