William Vickerey: On Principles of Efficient Congestion Pricing

William Spenser Vickerey, winner of the Nobel Prize for Economics, is considered the father of Congestion Pricing. He first proposed it in 1952, for the New York City subway system, recommending that fares be increased in peak times and in high-traffic sections and be lowered in others. Elected officials considered it risky at the time, and the technology was not ready. Later, he made a similar proposal for road pricing.

This article was written in 1992 by Todd Litman, executive director of the Victoria Transport Policy Institute, to summarize some of the defining  principles set out in Vickerey's extensive path-breaking early extensive pathbreaking contributions which in many ways defined the field. This essay can be found in its original form in the website of the Institute  at http://www.vtpi.org/vickrey.htm.

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Archives: The Limits of Cost-Benefit Analysis

During the early nineteen sixties the famed development economist, Albert Hirschman negotiated with the International Bank of Reconstruction and Development, part of the World Bank group, the financial support that he needed for an extended visit to several WB development projects scattered throughout the poor areas of the world. The document where he reports his visit was the matter of much controversy between the IBRD staff and Hirschman. One of the major points of disagreement was the latter´s refusal to employ the technique of cost-benefit analysis, then very popular at the WB, as a measure of the success of a project.

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