A New Approach to Private Roads
5 Pages Posted: 14 Jan 2003
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: Suggested Citation