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Congestion Control and Vehicle Ownership Restriction: The Choice of an Optimal Quota Policy

Author

Listed:
  • Winston T.H. Koh

    (School of Economics and Social Sciences, Singapore Management University)

Abstract
Singapore introduced a vehicle quota system (VQS) in 1990 as part of its overall policy to control urban congestion. While the VQS has reduced the annual growth rate of the vehicle population to about 3%, it has created uncertainty in the cost of vehicle ownership due to the fluctuations in license prices. The paper discusses three issues relating to the optimal design of a VQS: license transferability, subcategorization and the choice of an auction format. Our analysis shows that license transferability is not unambiguously desirable, sub-categorization is highly regressive, and an open auction format results in less aggressive bidding and lower license prices.

Suggested Citation

  • Winston T.H. Koh, 2003. "Congestion Control and Vehicle Ownership Restriction: The Choice of an Optimal Quota Policy," Working Papers 03-2004, Singapore Management University, School of Economics.
    • Handle: RePEc:siu:wpaper:03-2004
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    References listed on IDEAS

    as
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    Cited by:

    1. Conan Mukherjee, 2019. "On crony capitalism," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 46(1), pages 35-39, March.
    2. Li, Zhi-Chun & Wu, Qiao-Yu & Yang, Hai, 2019. "A theory of auto ownership rationing," Transportation Research Part B: Methodological, Elsevier, vol. 127(C), pages 125-146.
    3. Suwei Feng & Qiang Li, 2018. "Evaluating the car ownership control policy in Shanghai: a structural vector auto-regression approach," Transportation, Springer, vol. 45(1), pages 205-232, January.

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    More about this item

    Keywords

    congestion control; vehicle ownership; optimal quota; transport policy;
    All these keywords.

    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D45 - Microeconomics - - Market Structure, Pricing, and Design - - - Rationing; Licensing
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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