Pollution skyrocketed, too.

The most direct (and arguably only) way to reduce metro area traffic is by charging a price for congestion. Drivers may not initially like it—although surveys show they come around—but they do immediately respond to it. Jonas Eliasson illustrated that point during a TED-x talk on the Stockholm pricing program he co-designed: on the left is a rush-hour traffic jam the day before its implementation; on the right are empty roads the day it took effect:

The reverse scenario is also true, as a new study of Milan’s road pricing program reveals. In late July 2012, an Italian court called an abrupt and unexpected halt to the city’s congestion cordon, known as Area C, which cost 5 euros to enter from 7:30 a.m. to 7:30 p.m. The ruling caught people by surprise, since similar lawsuits had failed, so when the charge was suspended the next day you might have expected a lag before drivers rushed back to the rush-hour roads.

Lag, denied. In the Journal of Urban Economics, Matthew Gibson of Williams College and Maria Carnovale of Duke chart Area C traffic by date and found “the full magnitude of driver responses emerges immediately.” Take a look for yourself below: the segment on the left shows traffic before the ruling, and the one in the center shows traffic after the ruling. It’s as if drivers have a sixth sense for highway space—an effect transport scholars call “induced demand.”

Journal of Urban Economics

And don’t bother wondering whether the shift just reflects a seasonal change in driving habits. Gibson and Carnovale looked at traffic patterns from prior years, when an earlier pricing scheme was in effect. The summer months look the same as all the others—drivers stay away from the priced zone:

Journal of Urban Economics

By analyzing the accidental social experiment, Gibson and Carnovale offer some key insights on the benefits of the Milan pricing program:

  • Traffic. The pricing scheme results in 27,000 fewer cars entering Area C per day—a 14.5 percent decline in traffic. That includes cars exempted from the charge; the decline in those subject to it is even greater, at 19 percent. The researchers find that most drivers respond to the charge by traveling at different times or taking different routes, as expected.
  • Pollution. Milan’s program reduced air pollution (as measured by carbon emissions and PM10 particulate matter) from 6 to 17 percent. That’s a huge figure when you consider that Area C is just 5 percent of metro Milan—and that the city already has a pretty clean vehicle fleet, owing to a previous congestion fee that exempted cleaner cars. The researchers estimate the value of that environmental benefit at $3 billion a year.
  • Transit. Commuter routes adjacent to public transportation saw smaller traffic changes than those without similar access. In other words, many of the people who took public transit to work continued to do so even once the cordon price was suspended. This finding suggests that people are more than happy shifting out of cars if they can find homes with good transit access to work.

The pricing program was reinstated on September 17, and as another recent study shows, Milan experienced plenty of benefits for the whole of 2012 despite the eight-week halt. Paolo Beria of the Polytechnic University of Milan reports that traffic was down 31 percent on the year before, particulate matter was down 18 percent, and carbon emissions fell 35 percent. The program generated 13 million euros for the year—money reinvested in public transit and bike-share.

In other words, just about everyone wins, writes Beria. It’s no wonder an overwhelming majority of voters, 79 percent, had approved the scheme:

These figures, together with a generalised perception of the pollution and congestion problems, explain the overall ‘non-negative’ attitude of the city towards road pricing, with the unavoidable exception of a few stakeholders. The centre experienced a sharp reduction in traffic, which benefited both residents and city users and facilitated the commercial speed of cars and public transport.

There was one general exception to the traffic reduction in Area C—the minutes just after the priced period ends each day, at 7:30 p.m., when drivers flood the zone:

International Journal of Sustainable Transportation
As the huge peak in the chart at 19:30 shows, the change in behavior is immediate.

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