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Reforming Transport Pricing in the European Union

A Modelling Approach

Edited by Bruno De Borger and Stef Proost

This timely book deals with the problem of pricing passenger and freight transportation within Europe. The contributors argue that current legislation affecting pricing and regulation is increasingly less successful in dealing with market failures and externalities such as congestion, air pollution, noise and accidents. Technological progress and greater European co-operation has brought increased scope for the reform of transport policies.
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Chapter 16: Reform of interregional transport pricing policies in Ireland

Quinten Heaney, Margaret O’Mahony and Edna Gibbons


Quinten Heaney, Margaret O’Mahony and Edna Gibbons 16.1 INTRODUCTION This chapter reports on the results of applying the interregional model to study different pricing policies that reflect the external costs of the various transport services in Ireland. As Ireland is an island with no through traffic the one-country version of the model was used to calculate optimal policies. The structure of this chapter is the following. Section 16.1 describes the Irish transport problem. The next two sections explain the construction of the reference situation to be expected for 2005 and the main economic characteristics of the Irish transport market in this reference case, respectively. Sections 16.4 and 16.5 report the results of two pricing scenarios, a full optimal transport pricing policy and a scenario which does not allow price discrimination between peak and off-peak periods. Differences between the scenarios are discussed in Section 16.6. Finally, Section 16.7 concludes. 16.2 THE TRANSPORT PROBLEM IN IRELAND Ireland is an island on the west of Europe, covering an area of 70283 square kilometres, and has a population of 3.621 million people. The country suffered economically in the 1980s and early 1990s but is currently enjoying a period of economic prosperity. The general increase in disposable income amongst the population has induced a large increase in car ownership, particularly in the last few years, resulting in a noticeable increase in traffic congestion on urban and interregional routes. Dublin is the capital city and largest sea port. It...

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