Application of self-selected pricing to the Japanese highway fee system based on the ETC

Abstract

This paper on self-selected pricing for highway fees is from the proceedings of 14th international Conference on Urban Transport and the Environment in the 21st Century, which was held in Malta in 2008. The author describes the electronic toll collection (ETC) commuting discount which is applied in Japan to travels of less than 100km, except in metropolitan areas. The theoretical base of this policy is that is will be a self-selecting road pricing which discriminates users on the basis of payment means, travel distance, time period, and space. The author notes that for this policy to be fully implemented, users must be presented with long-term incentives for installing ETC devices in their automobiles. The author reports on a study that applied the traditional bottleneck congestion model to the ETC commuting discount of highway fees. The results demonstrated that the self-select pricing mechanism eliminates the negative effects of granting discounts in the peak period. The conditions are based on the number of ETC users, the capacity of the bottleneck, and the length of the discounted period. The author cautions that these study results may not hold when ETC use becomes widespread and traffic congestion returns.