Question Details

(Answered)-Question 2: Public policy solutions (a) Perform an economic


Question 2: Public policy solutions
(a) Perform an economic analysis of congestion charges as a public policy instrument. (Inyour answer, consider: what sort of public policy instrument is a congestion charge?How does it work in economic terms?) (6 marks)
(b) What other public policy instruments can the government employ to combat traffic congestion on busy public roads, and how do these differ from congestion charges? (6 marks)

Question 3: Efficiency of public policy solutions

(a) Based on your analysis in Question 2(a) above, how should congestion charges be setin order for congestion problems to be corrected in a way that maximises the overall welfare of society? Explain . (4 marks) (b) Do you think that the government will be successful in employing congestion charges to correct congestion problems and restore efficiency? Why or why not? (6 marks)


Prices & Markets

 

Semester 1, 2016

 

ECON1020 ASSIGNMENT 2

 

Value: 35% of total course assessment.

 

Word limit: 1300 words, in total.

 

Assignment due date: 5 pm, Friday 29th April 2016. Please be aware of RMIT?s penalties

 

for late submission, as they will apply to you.

 

Submission: This assignment must be submitted electronically via Blackboard. As it is

 

RMIT policy that all assignments be submitted electronically, hard copies or emailed copies

 

will not be accepted.

 

When submitting, please make sure you attach and upload your assignment as a one file

 

(either .doc, .docx or .pdf format). Please do not paste as text or upload a folder or zipped

 

file.

 

IMPORTANT: On the Blackboard system, you can only upload and submit the assignment

 

once. So, make sure you read and understand the student guide on How to submit your

 

assignment on Blackboard before you submit.

 

Marking: Marks will be awarded based on how well you: (a) understand the economic

 

concepts from the lectures; (b) apply the concepts to the questions; (c) conduct systematic

 

economic analysis using the concepts (this includes the use of appropriate graphs and

 

diagrams); (d) engage in critical discussion; and (e) draw conclusions. Note that general

 

layman discussions (for example, broad-brushed, journalistic information from the media)

 

do not constitute sufficient economic analysis.

 

Presentation: Assignments should be typed, using 10 ? 12 sized font and 1.5 ? 2 line

 

spacing. Graphs and diagrams can be hand drawn and scanned in, but must be clearly

 

drawn and clearly labelled.

 

Read the news article Radical road charges urged to fight Australia?s traffic troubles

 

(news.com.au 23/10/15) attached, about proposed traffic congestion charges on Australian

 

public roads.

 

Then use economic analysis to answer the following questions. In your answers, ensure

 

that you use relevant economic concepts and diagrams covered in this course. Note that

 

general layman or journalistic discussions do not constitute sufficient economic analysis.

 


 

1

 


 

Question 1: Reasons for government intervention

 

The imposition of congestion charges on motorists is a form of government intervention into

 

the issue of traffic congestion on busy public roads. With reference to economic theory

 

covered in this course, why do you think the government needs to intervene in this issue?

 

(8 marks)

 

Question 2: Public policy solutions

 

(a) Perform an economic analysis of congestion charges as a public policy instrument. (In

 

your answer, consider: what sort of public policy instrument is a congestion charge?

 

How does it work in economic terms?)

 

(6 marks)

 

(b) What other public policy instruments can the government employ to combat traffic

 

congestion on busy public roads, and how do these differ from congestion charges?

 

(6 marks)

 

Question 3: Efficiency of public policy solutions

 

(a) Based on your analysis in Question 2(a) above, how should congestion charges be set

 

in order for congestion problems to be corrected in a way that maximises the overall

 

welfare of society? Explain.

 

(4 marks)

 

(b) Do you think that the government will be successful in employing congestion charges to

 

correct congestion problems and restore efficiency? Why or why not?

 

(6 marks)

 

Question 4: Private solutions

 

How can each of us as private individuals contribute to the reduction of traffic congestion in

 

the absence of government intervention? Are such private solutions likely to be effective?

 

(5 marks)

 


 

2

 


 

Radical road charges urged to fight Australia?s traffic troubles

 

OCTOBER 23, 2015

 

Benedict Brook news.com.au

 


 

IN THE fashion capitals of the world it?s all the rage. But it?s not the latest catwalk

 

look, it?s a congestion toll.

 

Charging car owners to use roads in central London and Milan a fee of $26 a day or

 

more is part of everyday life.

 

With traffic jams costing Australia almost $14 billion a year, some experts are calling

 

for similar solutions to solve our car chaos.

 

But motoring groups have said drivers are already being slugged by motorway tolls

 

and shouldn?t be charged more.

 

Meanwhile, Sydney motorists are steeling themselves for more misery as George

 

Street, which currently carries a quarter of the CBD?s north-south traffic, starts to

 

progressively close from Friday night to enable construction of the city?s new light rail

 

network.

 


 

Committee for Sydney chief executive Tim Williams said now was the right time to

 

introduce a fee similar to London?s city centre traffic charge, ?Congestion in Sydney

 

can?t be solved by building more roads. You can?t control congestion unless you

 

have road pricing or congestion charging,? he said last week.

 

The price to drive had to be high enough to deter motorists, Mr Williams said, citing

 

the Harbour Bridge toll, ?For a while it did reduce traffic but of course the price was

 

never kept high enough to keep the downward pressure on congestion,? he told

 

Central.

 

City of Sydney Lord Mayor Clover Moore said the light rail would transform the CBD

 

but traffic snarl ups would cost the city $8 billion a year by 2020. ?A congestion

 

charge on traffic through the city centre makes a lot of sense but we have to get

 

public transport right first,? she said.

 

In 2011, the Victorian government rejected a proposal that would have seen

 

motorists charged $10 to enter the Hoddle grid, near central Melbourne.

 

TRAFFIC DOWN 10 PER CENT

 

A forest of CCTV cameras monitors all roads into central London, snapping number

 

plates and deducting the equivalent of $26 from the accounts of any driver passing

 

through. London?s transport bosses have hailed congestion charging, which is also in

 

place in Stockholm and Singapore, for cutting traffic by more than 10 per cent and

 

bolstering investment in public transport by $1.2 billion over 10 years ? more than

 

the cost of Sydney?s new light rail.

 

A University of Sydney survey from 2012 found 80 per cent of drivers would accept

 

some sort of charge for using roads with 62 per cent open to an $8 fee to enter the

 

CBD in rush hour if all the proceeds went towards public transport.

 

However, Professor David Hensher, a transport expert at the University of Sydney,

 

told news.com.au a congestion charge was not the answer, ?Congestion based

 

charging works in London but our CDB is infinitely smaller, we won?t get the same

 

benefits.?

 


 

Indeed, a report this year by Infrastructure Australia found Australia?s most

 

congested roads were outside of CBDs with the busiest stretch of asphalt being

 

Pennant Hills Road in suburban Sydney. The organisation said congestion cost

 

Australia $13.74 billion in 2011 and could rise to $53 billion by 2031.

 

A TOLL BOX IN YOUR CAR

 

Prof Hensher advocates a system where all cars would be fitted with a charging

 

device activated by distance and time of day. Driving in the rush hour would cost 5c

 

per kilometre with a daily return trip between Parramatta and Sydney?s CBD in both

 

peaks costing about $2.30 or around $500 per year.

 

Inevitably, most drivers would seek to avoid the expensive peak which could mean

 

Sydney would see a similar reduction in congestion seen in London.

 

National Roads and Motorists? Association President Kyle Loades said that while the

 

organisation was open to a congestion charge, it would not support its introduction

 

while motorists were subject to the current range of tolls.

 

?Many people have no choice about when and where they drive and for them there

 

must be an alternative in the form of a first class public transport system,? he told

 

news.com.au.

 

A far easier fix, he said, would be to axe the tolls on Sydney?s Cross City Tunnel

 

while George Street is closed. ?Dropping the tunnel toll, which is already too dear at

 

$5.27, would encourage drivers to avoid the CBD. Likewise, allowing free travel on

 

City Circle trains would reduce pedestrian traffic as footpaths are narrowed to allow

 

further traffic lanes.?

 

However, there?s no compulsion for the tunnel?s private operators to change the toll.

 

Transport for NSW?s CBD Co-ordinator General, Marg Prendergast, said that during

 

light rail construction, the road network would be under far more pressure and urged

 

drivers to travel outside of peak hour or use the city outskirts.

 

But, despite the jams, a fee for entering the city centre is unlikely, ?The introduction

 

of a CBD congestion charge or any new tolls for drivers travelling into the CBD is not

 

Government policy and is not under consideration,? she said.

 


 

 


Solution details:

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Oct 07, 2020

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP/h4>

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.

Order Now