Do Economic Incentives Promote Physical Activity? Evaluating the Impact of the London Congestion Charge on Active Commuting and Health
26 Pages Posted: 29 Mar 2014
Date Written: March 27, 2014
We investigate the role of economic incentives for health behaviour by estimating the impacts of the London Congestion Charge, a major transportation policy which increases the cost of car use within the central London area, on travel-related physical activity and health. Individuals living inside the charging zone are eligible for a 90% discount of the charge. Using a geographical information system (GIS), we analyse full-digit post code information to precisely identify the eligibility of the discount for survey participants in the London Travel Demand Survey 2005-2011. We employ a boundary regression-discontinuity design, and find no evidence that the financial incentive promotes active commuting (cycling and walking) or improves general health status around the border of the congestion charging zone. The result rejects the high aspirations expressed in the social epidemiology and public health literature.
Keywords: financial incentive, health behavior, the London Congestion Charge, geographical information system, regression-discontinuity
JEL Classification: D04, I18, R48
Suggested Citation: Suggested Citation