The external costs of private versus public road transport in the Metropolitan Area of Santiago, Chile

Abstract

We estimate marginal external costs per kilometer for car and bus in the Metropolitan Area of Santiago, Chile, in terms of congestion, road damage, accidents, air pollution and noise. Estimates are provided for both peak and off-peak periods. To carry out our analysis, we collected and integrated the output of several local studies. These estimates should contribute to a better debate on how to manage efficiently motor vehicles externalities by means of both (pigouvian) tax instruments, public transport subsidies and regulation. We also offer a comparison of our results with those reported in the literature.At peak times, marginal external costs per kilometer for petrol cars, diesel cars and buses are estimated at USD 0.51, USD 0.53 and USD 1.80 respectively. When these values are converted to passenger-kilometer, petrol cars, diesel cars and buses impose a marginal external cost of USD 0.41, USD 0.42 and USD 0.04 respectively. At off-peak times, all these values are reduced as congestion decreases significantly. The marginal external cost for petrol cars, diesel cars and buses are USD 0.15, USD 0.16 and USD 0.78 respectively. Differences in marginal external costs per passenger-kilometer between cars and buses shrink as these costs fall to USD 0.12, USD 0.13 and USD 0.05 for petrol car, diesel car and bus respectively.