A New Approach to Private Roads

5 Pages Posted: 14 Jan 2003

See all articles by Eduardo M. R. A. Engel

Eduardo M. R. A. Engel

Yale University - Department of Economics; National Bureau of Economic Research (NBER)

Alexander Galetovic

Universidad Adolfo Ibáñez; Stanford University - The Hoover Institution on War, Revolution and Peace; University of Padua - CRIEP

Ronald D. Fischer

University of Chile - Center of Applied Economics (CEA)

Abstract

Roadway privatization offers many benefits, from decreasing transportation's dependence on public coffers to using market forces to decrease the number of "white elephant" roadway projects. But, in the United States, only two private road projects have been undertaken during the last century, in part because potential investors and the government worry about the financial risks of such projects. We believe those risks can be overcome through government awarding of "Present-Value-of-Revenue" franchises to private roadway companies, which would protect those companies' investment but would also protect taxpayers.

Keywords: toll road, private road, Demsetz auction, present value of revenue franchise, PVR

Suggested Citation

Engel, Eduardo M. and Galetovic, Alexander and Fischer, Ronald D., A New Approach to Private Roads. Regulation, Vol. 25, No. 3, Fall 2002. Available at SSRN: https://ssrn.com/abstract=343602 or http://dx.doi.org/10.2139/ssrn.343602

Eduardo M. Engel (Contact Author)

Yale University - Department of Economics ( email )

28 Hillhouse Ave
New Haven, CT 06520-8268
United States
203-432-5595 (Phone)
203-432-5779 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Alexander Galetovic

Universidad Adolfo Ibáñez ( email )

Peñalolén
Santiago
Chile

Stanford University - The Hoover Institution on War, Revolution and Peace ( email )

Stanford, CA 94305-6010
United States

University of Padua - CRIEP ( email )

Padua
Italy

Ronald D. Fischer

University of Chile - Center of Applied Economics (CEA) ( email )

Republica 701
Casilla 2777
Santiago
Chile
+56/2/678 4055 (Phone)
+56/2/689 7895 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
270
Abstract Views
1,689
rank
116,348
PlumX Metrics