Traffic congestion is the build up of traffic preventing efficient movement between motorists and this is the one of the most faced problem modern cities suffer from. A main reason for this is the vast increase in car ownership over the recent years which are shown in Figure 1.

Figure1: Car ownership

Car Ownership since 1920

YEAR                        Number of cars (millions)

1920                                0.5

1940                                2.5

1960                                11

1980                                19

1990                                21

(Dupree. H., 1990.)

Congestion occurs when traffic demand is greater than the available capacity of the city. Although this may seem to be a simple concept, traffic demand is not constant and varies depending on the time of the year, the day of the week and even on the time of the day. Other factors affecting this are also: traffic incidents, work zones or the weather. (http://www.fhwa.dot.gov)

Traffic congestion is a constantly growing problem and the government must find methods to reduce this. Statistics show that a twenty minute journey could take up to an hour by 2006. In 2000, Edinburgh had the most new vehicle registrations compared to any other Scottish local authority and daily commuting trips had increased by 72% from 1981 to 2001. With 34,800 more jobs being predicted in the city by 2015, traffic congestion is expected to rise by 25% in the next twenty years. (http://newsvote.bbc.co.uk)

The government is using economic measures to reduce traffic congestion and this includes supply and demand, income and price elasticities and the role of substitutes and complements which will all be discussed in this essay.

The demand for transport which then leads to traffic congestion is not an area of theoretical analysis as it also has great practical relevance. The rate at which traffic congestion is produced in a city is mainly concerned with the establishment of a stable relationship between the demand for and supply of transport infrastructure and transport services.

In the recent past and in the current situation the relationship between supply and demand has been one-sided in many European countries, in the sense that demand for transport has outstripped the governments plans to reduce traffic congestion.

(Polak. J., Heertje.A, 1993.)

Demand for transport such as road freight facilities (contributing to traffic congestion) can also be seen as a derived demand as it is usually derived from another function.

Join now!

For example, a company producing books sees transport as a method of moving the goods from the factory/warehouse to the store. Therefore, as demand for goods increases so does the demand for transport facilities which causes an increase in traffic congestion.

(Cole. S., 1998.)

Methods to decrease the demand for transport would include increasing the price of fuel making it more expensive to travel which therefore forces motorists to use substitutes such as public transport.

The government could also hold limits on companies with the amount of miles travelled per month. Incentives would help them travel more efficiently ...

This is a preview of the whole essay