A Handbook of Transport Economics
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A Handbook of Transport Economics

Edited by André de Palma, Robin Lindsey, Emile Quinet and Roger Vickerman

Bringing together insights and perspectives from close to 70 of the world’s leading experts in the field, this timely Handbook provides an up-to-date guide to the most recent and state-of-the-art advances in transport economics. The comprehensive coverage includes topics such as the relationship between transport and the spatial economy, recent advances in travel demand analysis, the external costs of transport, investment appraisal, pricing, equity issues, competition and regulation, the role of public–private partnerships and the development of policy in local bus services, rail, air and maritime transport.
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Chapter 16: External Costs of Transport in Europe

Rainer Friedrich and Emile Quinet


Rainer Friedrich and Emile Quinet INTRODUCTION Many European countries show a strong tradition of state intervention into various economic sectors, especially agriculture, energy and transport. This tradition has entailed a special attention to externalities, a major cause of public intervention. This is one of the reasons why the Commission of the European Union has devoted a lot of care to study transport externalities. Two specific motivations have reinforced this tendency. The first one is the idea that, in order to support an efficient transport market, it is necessary that the users pay their fair cost, which is composed of private costs, infrastructure costs and also external costs, and therefore it is important to be able to measure these external costs as a basis for determining transport taxes and charges. The second one is the growth of environmental concerns in Europe, exemplified by the rise of green political parties which became a prominent actor in the political life of many countries of this continent. Due to these reasons, it is commonly acknowledged in Europe that a fair transport pricing would have a strong impact on transport modal splits and on mobility, and it would enhance rail transport which is acknowledged to be more environmentally friendly but has been losing market share for freight transport. It would also contribute to reverse the long term growth of road transport, which is accompanied by a rise of congestion and emissions of greenhouse gases. Consequently, a large number of studies on external transport costs in...

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