Dubai and congestion: Gulf Talent press release

Just in advance of a road toll system in Dubai Gulf Talent has issued a release. Some excerpts:

Dubai is officially the most congested city in the Middle East, according to the latest survey by GulfTalent.com, the region’s leading online recruitment portal.
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The journey times are particularly long for those commuting to Dubai from neighbouring Sharjah, home to many expatriates working in Dubai. Although just 15 km away and connected to Dubai via two express highways, Sharjah residents working in Dubai reported spending on average 2 hours and 44 minutes for the daily return journey to and from work, much of it in slow-moving bumper-to-bumper traffic.
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Cairo came second in the traffic rankings, with total daily commute time at 1 hour and 33 minutes on average.
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A core underlying problem remains that, across much of the region, the development of support infrastructure is lagging behind more prestigious mega-projects such as airports, business parks, and high-rise towers – leading to continuous bottlenecks and disruptions in traffic.

Commuting of course does not stand alone from the decision on where to live. The lengthy commutes are chosen in part because of the differences in rent between Dubai and Sharjah. Given that congestion within Dubai even for those who choose to live there the option of living in Sharjah becomes all the more attractive.

It's ironic that a city like Dubai whose road and transport system could have been designed for the start (the early 1970s) to work well now has commuting times that exceed those in an old and massive city like Cairo. It says something good about the Dubai economic model, but raises questions at the same time about the quality of urban planning.

But why should I criticize? I claim to be a libertarian after all.

The Stern Review on Traffic Jams :: Undercover Economist

Quote:

I’ll admit, the Stern Review on Traffic Jams doesn’t sound like the sort of thing to keep you awake at night. Traffic jams are less dramatic than catastrophic climate change, just as being mugged is less dramatic than being shot.

I realise it seems ridiculous to compare traffic jams to climate change, but I am not sure why. If climate change ever begins to have the same impact on our lives that congestion does today, it will be a dark day indeed. Think about the delays; the uncertainties; think about the lengths big-city dwellers have to go to in an effort to avoid traffic. Then think about how severely the climate would need to change before it had the same effect on your daily routine.

The new “happiness economists”, who are almost as fashionable as those who study climate change, have concluded that the way most people feel during their commute is the worst they feel all day. It would be worth a lot to escape that feeling. Of course, it would be worth a lot if we could do something about climate change too.
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I am just puzzled as to why an environmental problem that we fear will eventually become serious gets so much more attention than an environmental problem that we know for sure is serious right now.

THERE’S reason to think that we could be entering a golden age for congestion pricing :: NYT

Quote:

FOR the small group of economists and policy wonks interested in applying supply-and-demand theories to the thorny problems of gridlock and ever-longer commutes, the $2.9 trillion fiscal 2008 budget released by President Bush on Monday contained some excellent news: $130 million in grants to finance construction of so-called congestion pricing systems.
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congestion pricing was born and bred in New York City. William Vickrey, the longtime Columbia University economist and 1996 Nobel laureate, is viewed as the father of the concept.
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Since February 2003, when London introduced a system that charged a fee to motorists entering the central city on weekdays, “congestion has been reduced noticeably,” said Edward L. Glaeser, professor of economics at Harvard. “People are using the roads less, and there have been remarkable upticks in speeds.”

Beyond that, congestion pricing holds out the possibility of harnessing people’s innate economic rationality and self-interest in order to promote a series of public goods. Every time a driver turns onto the Henry Hudson Parkway, she slows down the travel speed of all the other drivers, imposing a cost — or, as economists say, a negative externality — on countless fellow citizens.
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“People are willing to pay for that time savings, and the price can be adjusted in such a way that you keep the lanes pretty full but don’t become overloaded,” said Kenneth Small, research professor of economics at the University of California, Irvine. “You can almost always drive in the express lanes without slowing down, free flow.” In San Diego, the price of using the H.O.T. lanes can change every six minutes.
The greater willingness of drivers and policy makers to consider congestion pricing is a recognition that building more roads will never be a solution to traffic problems.
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In New York, many elected officials argued that charging fees to drivers would be a burden for poor and middle-income people. Professor Glaeser disagrees. “The greatest beneficiaries of reduced congestion on roads in New York would be people who ride buses to get to and from work, who would find their commutes shortened [because fewer cars will be on the street].”

Road pricing in the news

1. New York Times:

Congestion pricing, the idea of charging drivers for bringing vehicles into the busiest parts of Manhattan, has become a kind of holy grail for transportation advocates and urban planners in New York — a coveted prize that has remained out of reach.

A year ago, officials from a prominent civic group floated a proposal to reduce traffic by levying a $7 fee on cars and trucks driving below 60th Street, but they found themselves treated not like visionary crusaders but like bird flu patients when policy makers at City Hall said very firmly that such a change was not on the mayor’s agenda for his second term.

Now a diverse array of civic and community groups — including such unlikely allies as conservative scholars and take-back-the-streets cycling advocates — are cautiously moving to raise the subject again in the hope of overcoming the resistance of New Yorkers and their political leaders.
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Mr. White said any congestion pricing program would have to be combined with — or preferably preceded by — other measures like improving bus service and smoothing traffic flow. His group has asked the city to move beyond what has already been done to reduce the number of parking permits given to city employees, who drive to work in large numbers. Transportation Alternatives would also like to see more Midtown parking spaces converted to loading zones so that streets are not clogged with double-parked trucks unloading goods.

Advocates of congestion pricing are reluctant to make specific proposals on how it could be carried out in New York, but they often point to London as an example of a successful program.

2. Seattle Times (via Greg Mankiw):

For about eight months, drivers in 275 Seattle-area households agreed to pay for something the rest of us get for free: The right to drive on the region's freeways and streets.

They were guinea pigs in a pioneering study that explored how motorists' behavior might change if they had to pay tolls — not just on a few bridges or highways, but on almost every road with a yellow center line.

Researchers established virtual tolls ranging from a nickel to 50 cents a mile. They gave participants pre-paid accounts of between $600 and $3,000, and told them they could keep whatever the tolls didn't eat up.

The experiment ended in February. Preliminary results, released this month, suggest that if such so-called "road pricing" were widespread, it could make a significant dent in traffic.

3. KTRK of Houston:

Would you pay more money to travel toll roads at peak times, such as rush hour? It may become a reality - after county commissioners decided to take a look at it.

The last increase happened two years ago and added a million dollars more a week to the toll road authority. But officials say this new study is also aimed at easing traffic congestion.
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Harris County commissioners' court approved a study that will analyze the possibility of raising toll rates.

"Part of the study is congestion pricing -- the possibility of during rush hours times they could raise tolls so people who do use it will have to pay a little more," explained Gloria Roemer. "That may make some people not want to use it."

4. Birmingham Post:

The West Midlands has been urged to show leadership over road pricing after a report exposed the damaging effects of traffic congestion on the region.

Commuters in the West Midlands take longer to travel to work than those in competing regions such as Merseyside or Newcastle, according to the Department for Transport. And roads here are more congested than any part of the country except London.

Delays faced by employees are part of the reason congestion costs West Midlands business and industry £2.2 billion each year.

The report was published as West Midland councils presented the Department of Transport with proposals for a £26.6 million traffic management scheme.

Birmingham Chamber of Commerce demanded the Government make good on promises to invest in public transport in the region. But local authorities were also under pressure to come out in favour of road pricing scheme which could reduce congestion on the roads. [The government has made road funding contingent on local government adoption of congestion pricing.]

Local MP Gisela Stuart (Lab Edgbaston) said: "We need the councils to start showing some leadership. There has been a failure to make any progress on road pricing. "We seem to be losing out on that, because there has been no leadership out there."

West Midlands authorities needed to "knuckle down" and make a decision on road-pricing, she said. "They need to express a preference as to which option they support."

5. Taipei Times:

An Environmental Protection Administration (EPA) proposal that would require car and motorbike owners entering Taipei County and Taipei and Kaohsiung cities to pay a "congestion charge" met strong opposition from two candidates running for Kaohsiung mayor. The EPA is considering introducing the charge to help relieve traffic congestion and reduce air pollution in the three administrative areas, based on a system used in London.

I'm an economist, and I endorse this politically infeasible proposal. For Sharjah, Dubai, and where ever congestion is found.

If you want more roads without being charged for their use, then you'll get more traffic creating the "need" for more roads. That's the mechanism by which Robert Moses built his empire in New York.

Here are some of the major roadworks planned in Dubai.

Radical new proposals to curb traffic :: EmiratesToday

Quote:

A top municipal official has outlined radical new proposals to reduce congestion and accidents in Dubai. His ideas include:

* Limiting new vehicle registrations to 10,000 over the next two years. Last year more than 160,000 new vehicles were registered, of which nearly 137,000 were cars.
* Introducing toll gates on all entry points to Dubai emirate.
* Installing bus or public transport-only lanes on major roads and highways.
* On the spot fines for traffic offences and a system where motorists are notified unlike at present where they have to make inquiries to find out if they have been fined.
* Increasing police presence at traffic interchanges during peak hours.
* Traffic safety awareness campaigns in Indian and Pakistani languages to target the majority expatriate population of Dubai, in addition to the current programmes which are aimed at Arabic and English speakers.

On the spot fines would be more likely to result in changed behavior.

Limiting the number of new car registrations presents an interesting finger exercise in economics. How will the new registrations be allocated? Will you be able to sell your registration to someone else? And, if not, will potential newcomers to Dubai be turned off by the prospect of not being able to own a car? Will people live in Sharjah in order to be able to register a car?

Why not just increase the fee for registering a vehicle, and for renewing registration?

Road tolls update :: Emirates Today

Emirates Today follows up on some basic questions concerning implementation of tolls in Dubai.
Purpose:

if the main purpose of Dubai’s proposed road toll system is to reduce traffic congestion, residents might pay different rates at different times of the day, depending on the volume of traffic.

“Toll systems can perform a number of functions,” said Josef Czako, director of international business development at Kapsch, one of the three companies to submit a bid for a Dubai Municipality tender for the project in April this year.

. . . “They can finance new infrastructure, help manage traffic flow, reduce negative environmental impacts, or enforce a combination of all these,” said Czako, explaining that how the system is implemented would depend on what goals the authorities want to see on the roads.

Flexible tariffs with higher rates during peak hours might be on the cards if spreading out traffic is the major concern for Dubai’s authorities, he said.

Collection:

Whatever the goals, it is important that the toll system in place does not create additional traffic build-up, said Czako. “The toll charging scheme should not create any congestion,” he said.

The most basic form of toll collection involves drivers stopping at toll gates and handing out cash to collectors, Czako said.

However, with a capacity of only 200-300 cars per lane per hour, this system can cause traffic build-up and delays, he added.

“Looking at Dubai, I cannot imagine having this on the road,” he said, as Dubai’s roads have no space to fit the booths that would be required.

My emphasis.

New toll system to curb Dubai traffic :: Gulf News

Read the whole thing.

The nightmare is that the cure may be worse than the disease at least initially. It takes time to collect tolls, and not everyone will have transponders.

Charging for road use when there is congestion is a classic example taught in basic economics courses. What's neglected in those stories is the costs of collecting the toll, particularly the time cost. There has of course been a huge drop in these costs of collection due to the use of transponder technology, and with that an increasing use of tolls to deal with congestion problems.

This accompanying story in Gulf News is the nightmare scenario. Extract:

Dubai may set up road tolls on some internal roads that are congested, including a manual toll on Al Muraqqabat Road, sources said.

Other streets under consideration include Bank Street, Baniyas Street and Al Maktoum Street.

The plans form part of a proposal by the Dubai Road and Transport Authority to install a manual and electronic toll system in and around Dubai with specific focus on entry from Sharjah and Abu Dhabi, sources told Gulf News.

Time of day rates? Rates should be lower at times when congestion is less. I do not see a mention of time of day rates in these reports.

Congress seen paving way for private toll roads - Yahoo! News

The mess that is the Iraqi economy is often blamed on a lack of public infrastructure investment. Let's agree that Iraq's infrastructure is holding back its economic recovery. Let's agree that it is underdeveloped due to a history of poor government. Let's not agree that public funding of infrastructure is the only tool. Saddam did not invest in infrastructure (unless you count the oil-for-palaces program), but his policies also did not create a good environment for private investment, whether in infrastructure or otherwise.