Discussion paper

DP174 Road User Charges in Britain

At present the Department of Transport allocates road use costs according to concepts of fair attribution, and road user charges for commercial vehicles are intended to cover these costs. The paper calculates the efficient road user charge - the marginal social cost of highway use - and compares these figures with the cost allocation results. Recent research suggests that the efficient road damage charge is only about 40 percent of the total damage, but that congestion costs may more than compensate for this shortfall. This is confirmed for the United Kingdom, where the efficient charge for cars is shown to be higher than their allocated cost, but for heavy goods vehicles is about the same. Accident costs may substantially raise these figures.


Newbery, D (1987), ‘DP174 Road User Charges in Britain‘, CEPR Discussion Paper No. 174. CEPR Press, Paris & London. https://cepr.org/publications/dp174