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Marion Terrill (2019), an economist from the Grattan Institute, outlines her support for a congestion tax in the video: https://www.youtube.com/watch?v=jd_kfvwFaug With reference also to the

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Marion Terrill (2019), an economist from the Grattan Institute, outlines her support for a congestion tax in the video: https://www.youtube.com/watch?v=jd_kfvwFaug

With reference also to the elasticities in the table provided,

Please discuss the possible equity implications of a congestion tax.

image text in transcribed
Table 4 Estimated Long Run Elasticities (Johansson and Schipper 1997, p. 209) Estimated Taxation Population Component Fuel Price Income (Other than Fuel) Density Car Stock -0.20 to 0.0 0.75 to 1.25 -0.08 to -0.04 -0.7 to -0.2 (vehicle ownership) (-0.1) (1.0) (-0.06) (-0.4) Mean Fuel Intensity -0.45 to -0.35 -0.6 to 0.0 -0.12 to -0.10 -0.3 to -0.1 (fuel efficiency) (-0.4) (0.0) (-0.11) (-0.2) Mean Driving Distance -0.35 to -0.05 -0.1 to 0.35 0.04 to 0.12 -0.75 to 0.0 (per car per year) (-0.2) (0.2) (0.06) (-0.4) -1.0 to -0.40 0.05 to 1.6 -0.16 to -0.02 -1.75 to -0.3 Car Fuel Demand (-0.7) (1.2) (-0.11) (-1.0) -0.55 to -0.05 0.65 to 1.25 -0.04 to 0.08 -1.45 to -0.2 Car Travel Demand (-0.3) (1.2) (0.0) (-0.8) Summarizes various studies. Numbers in parenthesis indicate original authors' "best guess" values

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