Evaluating the effectiveness of two Milan’s congestion limitation policies: charge increase and vehicle type limitation

Abstract

Congestion pricing, also referred to as road pricing, is a form of Pigouvian taxation designed to limit or reduce vehicular traffic within a specific area. These systems aim to encourage changes in driving behavior and the choice of transportation mode. An example of a congestion pricing system is the Milan Area C charging zone, which operates on a fixed-rate basis. In recent years, two modifications to the restrictions have been introduced: i) limitations on vehicle types allowed to enter the zone, and ii) a 50 percent increase in congestion charges. By using open data from Area C vehicle access and mobile phone data on overall presence in the area, this study seeks to evaluate the effectiveness of these two restriction policies within the AREA C congestion policy. The findings indicate that both restrictions influenced the choice of transportation mode, with vehicle type limitations having a greater impact than price increases. This evidence showing the effectiveness of vehicle type restrictions and increased charges could support the enhancement of pricing policies and vehicle limitations in Milan and similar cities. Moreover, demographic factors, including the proportion of women and elderly people in the area, significantly influence transportation choices, underscoring the importance of equitable policy implementation to enhance acceptance and effectiveness among more vulnerable groups.