4 Crosstown Traffic
                    
                            
                                Note:traffico: dove il mercato manca o è imperfetto
                            
                    
                
            
        
                Note | Location: 1,272
        
            4@@@@@@@@
        
                Yellow highlight | Location: 1,276
        
            why did I spend two hours stuck in traffic on the way to work this morning?
                
                    
                            
                                Note:PROBLEMI QUOTIDIANI DI UN MONDO SENZA MERCATI
                            
                    
                
            
        
                Yellow highlight | Location: 1,278
        
            The obvious answer is that, of course, there is no market perfect
                
                    
                            
                                Note:CHIARO
                            
                    
                
            
        
                Yellow highlight | Location: 1,280
        
            because perfect markets provide such a clear benchmark, economists find it much easier to start from them
                
                    
                            
                                Note:METODO DI LAVORO X RISOLVERE I PROBLEMI
                            
                    
                
            
        
                Yellow highlight | Location: 1,282
        
            What’s wrong with my world
                
                    
                            
                                Note:tttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,287
        
            Markets fail to work well in the face of scarcity power,
                
                    
                            
                                Note:I DIFETTI DEL MERCATO... MONOPOLIO... PRIMO
                            
                    
                
            
        
                Yellow highlight | Location: 1,288
        
            market is dominated by a single company, Microsoft,
                
                    
                            
                                Note:ES NEL SOFTWARE
                            
                    
                
            
        
                Yellow highlight | Location: 1,289
        
            lack information.
                
                    
                            
                                Note:SECONDO
                            
                    
                
            
        
                Yellow highlight | Location: 1,289
        
            I would leave my doctor’s surgery with no idea whether he had given me good treatment,
                
                    
                            
                                Note:ESEMPIO DI ASIMMETRIA
                            
                    
                
            
        
                Yellow highlight | Location: 1,292
        
            if some people make decisions that affect bystanders:
                
        
                Note | Location: 1,292
        
            TERZO ESYERNALITÀ...CE NE OCCUPEREMO QUI
        
                Yellow highlight | Location: 1,294
        
            ‘market failures’:
                
                    
                            
                                Note:I TRE GRANDI PROBLEMI
                            
                    
                
            
        
                Yellow highlight | Location: 1,299
        
            How drivers affect bystanders
                
                    
                            
                                Note:Ttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,301
        
            London’s current air pollution is not as severe as the ‘Great Stink’ of the 1850s,
                
                    
                            
                                Note:AMMETIAMOLO
                            
                    
                
            
        
                Yellow highlight | Location: 1,303
        
            Around seven thousand people a year die prematurely because of traffic pollution in Britain,
                
                    
                            
                                Note:VITTIME
                            
                    
                
            
        
                Yellow highlight | Location: 1,305
        
            the cost of delays from congestion are even worse,
                
                    
                            
                                Note:MA C È DI PIÙ
                            
                    
                
            
        
                Yellow highlight | Location: 1,306
        
            Then there is the noise, the accidents and the ‘barrier effect’,
                
                    
                            
                                Note:ALTRO
                            
                    
                
            
        
                Yellow highlight | Location: 1,321
        
            Different kinds of prices: marginal and average
                
                    
                            
                                Note:Ttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,323
        
            paid a sizeable annual tax called ‘Vehicle Excise Duty’.
                
                    
                            
                                Note:L USO DELL AUTO NN È GRATIS
                            
                    
                
            
        
                Yellow highlight | Location: 1,324
        
            Petrol and diesel are also taxed
                
                    
                            
                                Note:ALTRI ADDEBITI ALL AUTOMOBILISTA
                            
                    
                
            
        
                Yellow highlight | Location: 1,326
        
            Britain, drivers pay over £30 billion in taxes on cars
                
                    
                            
                                Note:NEL COMPLESSO
                            
                    
                
            
        
                Yellow highlight | Location: 1,327
        
            To ask ‘have they paid enough?’ is to ask the wrong question. The right question is, ‘are they paying for the right things?’ The answer is no.
                
                    
                            
                                Note:LA DOMANDA GIUSTA
                            
                    
                
            
        
                Yellow highlight | Location: 1,328
        
            The average price that a driver pays for a journey across a city is quite high if the driver is paying an annual licence fee.
                
                    
                            
                                Note:CI SONO DUE PREZZI...ECCO IL PRIMO
                            
                    
                
            
        
                Yellow highlight | Location: 1,329
        
            the price that the driver pays for one extra trip across the city is low:
                
                    
                            
                                Note:SECONDO
                            
                    
                
            
        
                Yellow highlight | Location: 1,330
        
            Once you’ve paid for the right to take the car on the street in the first place, you don’t get a discount for low mileage:
                
                    
                            
                                Note:IN SINTESI
                            
                    
                
            
        
                Yellow highlight | Location: 1,333
        
            When I was in college, clubs and societies used to have big parties where some people didn’t drink at all and, less surprisingly, most people drank far too much. This was because there were two types of ticket. ‘Alcoholic’ tickets allowed unlimited boozing after payment of an up-front fee of, say, £10. The other type of ticket was a lot cheaper, and you had to drink rancid orange juice instead and stand in a corner while the drinkers got more and more obnoxious. Turning up and having a couple of beers was a pretty expensive proposition,
                
                    
                            
                                Note:BUFFET E PREZZO MEDIO
                            
                    
                
            
        
                Note | Location: 1,337
        
            IL PROB DELLE FESTE
        
                Yellow highlight | Location: 1,347
        
            (a) raising the up-front fee for drinking?, (b) buying better orange juice? or (c) scrapping the up-front fee and charging people for what they drank?
                
                    
                            
                                Note:LE TRE SOLUZIONI
                            
                    
                
            
        
                Yellow highlight | Location: 1,354
        
            (a) raise the upfront fee for driving; (b) supply better ‘orange juice’ (more buses, better trains, cycle routes, pedestrian crossings); or (c) scrap the up-front fee and charge people for the trips they drive.
                
                    
                            
                                Note:LE TRE SOLUZIONI NEL CASO DEL TRAFFICO
                            
                    
                
            
        
                Yellow highlight | Location: 1,369
        
            Pricing should reflect the damage
                
                    
                            
                                Note:Tttttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,370
        
            In most European countries, drivers do pay a tax per mile in the form of a high tax on fuel.
                
                    
                            
                                Note:STIAMO SEMPLIFICANDO
                            
                    
                
            
        
                Yellow highlight | Location: 1,373
        
            but it is the commuters in the London, New York or Paris rush hours who are causing the most serious congestion,
                
                    
                            
                                Note:NN TUTTE LE BENZINE SONO UGUALI
                            
                    
                
            
        
                Yellow highlight | Location: 1,397
        
            The trick is to mimic perfect markets by getting drivers to pay all of the costs of their actions:
                
                    
                            
                                Note:LA SOLUZIONE
                            
                    
                
            
        
                Yellow highlight | Location: 1,406
        
            Two objections to externality charges
                
                    
                            
                                Note:Tttttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,409
        
            the pro-car lobby argues that drivers pay enough,
                
                    
                            
                                Note:PRIMA CONTESTAZIONE
                            
                    
                
            
        
                Yellow highlight | Location: 1,411
        
            the rich will still be able to do whatever it was that was objectionable.
                
                    
                            
                                Note:ALTRA OBIEZIONE
                            
                    
                
            
        
                Yellow highlight | Location: 1,418
        
            it is just as true that the rich can afford to eat more than the poor.
                
                    
                            
                                Note:NATURAL
                            
                    
                
            
        
                Yellow highlight | Location: 1,418
        
            if you accept the workings of the price system for typical goods like food, why not road space or clean air?
                
                    
                            
                                Note:Ccccccccccccccc
                            
                    
                
            
        
                Yellow highlight | Location: 1,422
        
            in the United Kingdom, poor people do not drive – they bicycle, walk or take the bus.
                
                    
                            
                                Note:REDISTRIB IN SENSO GIUSTO
                            
                    
                
            
        
                Yellow highlight | Location: 1,426
        
            in the United States, where the poor still drive a lot
                
                    
                            
                                Note:PURTROPPO
                            
                    
                
            
        
                Yellow highlight | Location: 1,427
        
            externality charges can be designed not to redistribute very much.
                
                    
                            
                                Note:TENERE CONTO DEL VEICOLO
                            
                    
                
            
        
                Yellow highlight | Location: 1,434
        
            they feel that pollution should simply be illegal, rather than illegal for the poor
                
                    
                            
                                Note:CERTI AMBIENTALISTI
                            
                    
                
            
        
                Yellow highlight | Location: 1,436
        
            A partial response is to say that even the rich do not pollute for fun.
                
                    
                            
                                Note:PRIMA RISPOSTA
                            
                    
                
            
        
                Yellow highlight | Location: 1,440
        
            A congestion charge can be set at £1 a day, or £10 a day or £1000 a day.
                
                    
                            
                                Note:SECONDA RISPOSTA
                            
                    
                
            
        
                Yellow highlight | Location: 1,445
        
            government could give everybody vouchers, which allow them to drive up to twenty miles per week. The immediate result of such a plan is that some people, mostly poor, would want to sell their vouchers to others, mostly rich:
                
                    
                            
                                Note:I VOUCHER NN AFFRONTANO LA CRITICA
                            
                    
                
            
        
                Yellow highlight | Location: 1,450
        
            Other alternatives such as high parking charges are probably less efficient still,
                
                    
                            
                                Note:ALTERNATIVE INEFFICIENTI
                            
                    
                
            
        
                Yellow highlight | Location: 1,451
        
            the relationship between driving and parking is rather indirect.
                
                    
                            
                                Note:Ccccccccc
                            
                    
                
            
        
                Yellow highlight | Location: 1,457
        
            How much is your life worth?
                
                    
                            
                                Note:Tttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,458
        
            the level of any externality charge is bound to be a matter for controversy.
                
                    
                            
                                Note:IL PROBLEMA CANONICO
                            
                    
                
            
        
                Yellow highlight | Location: 1,461
        
            a different charge, which would be imposed for every trip,
                
                    
                            
                                Note:NECESSARIO
                            
                    
                
            
        
                Yellow highlight | Location: 1,466
        
            That sounds complicated.
                
                    
                            
                                Note:Ccccc SUV...VEICOLI PESANTI...VEICOLI INQUINANTI...INQ LOCALE..GW...
                            
                    
                
            
        
                Yellow highlight | Location: 1,467
        
            imagine each car having a little computer
                
                    
                            
                                Note:SOLUZIONE SCATOLA NERA
                            
                    
                
            
        
                Yellow highlight | Location: 1,470
        
            But there is another difficulty: working out what the costs of the externalities really are.
                
                    
                            
                                Note:QUI SÌ CHE COMINCIANO LE DIFFICOLTÀ
                            
                    
                
            
        
                Yellow highlight | Location: 1,479
        
            Every policy the government adopts, and every individual choice you make, implies that a valuation has been made,
                
                    
                            
                                Note: È DA Invece USI PENSARE DI SCAMPARE A QS PROBLEMI
                            
                    
                
            
        
                Yellow highlight | Location: 1,482
        
            If you pay more to avoid a noisy area when you rent a flat or a hotel room,
                
                    
                            
                                Note:ES
                            
                    
                
            
        
                Yellow highlight | Location: 1,486
        
            Should the government install extra street signs and markings, or spend more money on speed cameras,
                
                    
                            
                                Note:ALTRO ES
                            
                    
                
            
        
                Yellow highlight | Location: 1,492
        
            Economists have a theory of ‘revealed preference’,
                
                    
                            
                                Note:LA COSA MIGLIORE È GUARDARE AI COMP REALI
                            
                    
                
            
        
                Yellow highlight | Location: 1,500
        
            House prices contain embedded information about the value people place on all kinds of amenities: shops, greenery, low crime, quiet, the sun through the window in the morning and so on.
                
                    
                            
                                Note:FONTI INCORPORATE
                            
                    
                
            
        
                Yellow highlight | Location: 1,503
        
            wages can reveal information if there is a salary differential for jobs with very similar skill requirements but different levels of danger.
                
                    
                            
                                Note:ALTRA FONTE
                            
                    
                
            
        
                Yellow highlight | Location: 1,514
        
            Two different gaps in our knowledge
                
                    
                            
                                Note:Tttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,516
        
            we also do not know the cheapest way of reducing noise, accidents, pollution and congestion. It is with this second gap that externality pricing comes into its own.
                
                    
                            
                                Note:L IGNORANZA CHE LA TASSA PREZZO PRENDE DI PETTO...IL VERO VANTAGGIO DELLA SOLUZIONE PIGOU
                            
                    
                
            
        
                Yellow highlight | Location: 1,525
        
            The New Orleans effect
                
                    
                            
                                Note:Ttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,529
        
            dingy houses in response to the policy, in force from 1696 to 1851, of taxing people according to the number of windows their homes had.
                
                    
                            
                                Note:LE CASE DELLA PERIFERIA INGLESE
                            
                    
                
            
        
                Yellow highlight | Location: 1,534
        
            Congestion charging can change the small decisions we make every week about whether to drive to a supermarket, or catch the bus, or walk to a local store or buy food on the internet.
                
                    
                            
                                Note:LA TASSA LAVORA SUL PICCOLO E SI ESPANDE
                            
                    
                
            
        
                Yellow highlight | Location: 1,537
        
            There’s also a domino effect here, as changes in behaviour reinforce each other.
                
                    
                            
                                Note:CONTAGIO
                            
                    
                
            
        
                Yellow highlight | Location: 1,539
        
            If more people try to save the congestion charge by working at home a couple of days a week or commuting at a different time of day, more companies will find ways of accommodating them.
                
                    
                            
                                Note:ESEMPIO
                            
                    
                
            
        
                Yellow highlight | Location: 1,542
        
            The attractive thing about externality pricing is that it attacks the problem but makes no assumption about the solution.
                
                    
                            
                                Note:IL BELLO È CHE NOI NN CONOSCIAMO LA SOLUZIONE
                            
                    
                
            
        
                Yellow highlight | Location: 1,549
        
            After a year, car journeys fell by nearly a third.
                
                    
                            
                                Note:2003 LONDON INTRODUCE LA TASA...REAZIONE VELOCE
                            
                    
                
            
        
                Yellow highlight | Location: 1,555
        
            Battling pollution on the cheap
                
                    
                            
                                Note:Ttttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,556
        
            In the 1990s the Environmental Protection Agency (EPA) in the United States discovered how cost-effectively an externality charge could fight pollution when it decided to attack acid rain.
                
                    
                            
                                Note:UN ESPERIENZA POSITIVA...INQUINAMENTO DA SOLFURI
                            
                    
                
            
        
                Yellow highlight | Location: 1,566
        
            They set up an auction for the right to emit sulphur dioxide, which causes acid rain. Polluters were given a quota
                
                    
                            
                                Note:ASTA X CAPIRE IL VALORE
                            
                    
                
            
        
                Yellow highlight | Location: 1,568
        
            When the EPA simply tried to tell them to install sulphur scrubbers, the power generators argued that it would be very expensive to do so,
                
                    
                            
                                Note:DICEVANO PLA VERITÀ
                            
                    
                
            
        
                Yellow highlight | Location: 1,572
        
            The regulators discovered that getting rid of sulphur dioxide was so cheap that few people were willing to pay much for the right to
                
                    
                            
                                Note:LA SCOPERTA GRAZIE ALLE ASTE
                            
                    
                
            
        
                Yellow highlight | Location: 1,579
        
            There is massive controversy about how much emission reduction will cost, but an auction of permits to extract oil, coal and gas would soon start to tell us.
                
                    
                            
                                Note:PARALLELO
                            
                    
                
            
        
                Yellow highlight | Location: 1,587
        
            many economists believe that, like sulphur permits in California, the carbon permits would quickly reveal that decarbonisation is cheaper than we expected,
                
                    
                            
                                Note:PRONOSTICI
                            
                    
                
            
        
                Yellow highlight | Location: 1,589
        
            Is the environment too important to be a moral issue?
                
                    
                            
                                Note:Ttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,593
        
            ‘How did you travel here today? We need to know for our carbon offset programme.’
                
                    
                            
                                Note:UNA QUESTIONE MORALE O PRAGMATICA?
                            
                    
                
            
        
                Yellow highlight | Location: 1,604
        
            Why would an environmental charity organise a carbon-neutral meeting?
                
                    
                            
                                Note:CHE C ENTRANO LORO?
                            
                    
                
            
        
                Yellow highlight | Location: 1,608
        
            In other words, why be ‘carbon-neutral’ when you can be ‘carbon-optimal’,
                
                    
                            
                                Note:IL QUESITO DELL ECONOMISTA
                            
                    
                
            
        
                Yellow highlight | Location: 1,614
        
            An unkind view would be that it was indulging in moral posturing.
                
                    
                            
                                Note:VANITÀ?
                            
                    
                
            
        
                Yellow highlight | Location: 1,616
        
            an environmental charity can be directly connected to the fact that public policies do not make evident the environmental costs of our actions.
                
                    
                            
                                Note:UN IPOTESI
                            
                    
                
            
        
                Yellow highlight | Location: 1,620
        
            Which is worse: disposable nappies (which clog up landfill sites) or washable nappies (where the washing process uses electricity and releases polluting detergents)?
                
        
                Note | Location: 1,621
        
            COL MORALISMO CI SI FICCA FIOCA N UN GINEPRAIO
        
                Yellow highlight | Location: 1,632
        
            Electricity generation that contributed to climate change would be taxed, too, which would raise electricity prices unless we could develop cleaner fuels.
                
                    
                            
                                Note:FORSE È UNA QS REDISTRIBUTIVA
                            
                    
                
            
        
                Yellow highlight | Location: 1,638
        
            Being positive
                
                    
                            
                                Note:Ttttttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,643
        
            If Belinda opens an attractive pavement café, the streets are more pleasant to walk along,
                
                    
                            
                                Note:ESTERNALITÀ POSITIVE
                            
                    
                
            
        
                Yellow highlight | Location: 1,649
        
            Just as negative externalities will tend to lead to too much pollution or congestion, positive externalities will leave us undervaccinated with scruffy neighbours and a dearth of pleasant cafés.
                
                    
                            
                                Note:BELINDA FALLISCE
                            
                    
                
            
        
                Yellow highlight | Location: 1,653
        
            instead of an externality charge, an externality subsidy.
                
                    
                            
                                Note:SOLUZIONE SIMMETRICA
                            
                    
                
            
        
                Yellow highlight | Location: 1,654
        
            Vaccinations, for example, are often subsidised by governments or by aid agencies; scientific research, too, usually gets a big dose of government funding.
                
                    
                            
                                Note:ESEMPI
                            
                    
                
            
        
                Yellow highlight | Location: 1,657
        
            Too much of a good thing? Solving externalities without the government
                
                    
                            
                                Note:Tttttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,658
        
            I may complain about my neighbour’s tree damaging my wall, but if it really bothers me I can pay him to let me cut it down.
                
                    
                            
                                Note:COASE
                            
                    
                
            
        
                Yellow highlight | Location: 1,663
        
            Externalities simply aren’t externalities if people can easily get together and negotiate.
                
                    
                            
                                Note:TRANSAZIONI
                            
                    
                
            
        
                Yellow highlight | Location: 1,689
        
            the positive externality has been dealt with twice over, once by a government subsidy and once by a process of bargaining.
                
                    
                            
                                Note:UN PROBLEMA
                            
                    
                
            
        
                Yellow highlight | Location: 1,692
        
            If the government taxes my neighbour’s dirty petrol-driven lawnmower and I also offer to pay him to get rid of it because I dislike the noise and smell, the combination of the taxes and my own offer may persuade him to ditch the monster, even though the fun and convenience he gets from the thing outweigh any damage to anybody else and he really should be keeping it.
                
                    
                            
                                Note:UN CASO
                            
                    
                
            
        
                Yellow highlight | Location: 1,698
        
            Government-imposed externality charging is far more likely to be appropriate in situations where a negotiation over the externality will not work, as in the case of the noise from low-flying aircraft.
                
                    
                            
                                Note:QUANDO DEVE INTERVENIRE IL GOVERNO
                            
                    
                
            
        
                Yellow highlight | Location: 1,705
        
            Epilogue: what is economics really about?
                
                    
                            
                                Note:Ttttttttttt
                            
                    
                
            
        
                Yellow highlight | Location: 1,716
        
            A pollution tax might well make a number like GDP smaller. But who cares? Certainly not economists. We know that GDP measures lots of things that are harmful (sales of weapons, shoddy building
                
                    
                            
                                Note:CHI SI LAMENTA DELLE TASSE
                            
                    
                
            
        
                Yellow highlight | Location: 1,718
        
            Most economics has very little to do with GDP. Economics is about who gets what and why.
                
                    
                            
                                PESANTE!!!!