Under what conditions is a congestion tax a good idea?

Discuss mandatory insurance for corporate directors and its effect on auditor liability.
December 26, 2020
What was the growth rate of the economy from 2014 to 2015? Explain
December 26, 2020

In 2008, then-Mayor Michael Bloomberg proposed congestion pricing for New York City streets. Congestion pricing, in its simplest form, means that cars and trucks entering a specific highly congested area of Manhattan would have to pay an extra charge—perhaps as much as $8—during peak morning and evening rush hours. The proposal was approved by the New York City Council but turned down by the New York State Legislature. (LO6-4) a) Does this proposal rely on the idea of public goods, externalities, regulation, or redistribution? b) Show the effect of the congestion tax on a supply–demand diagram. c) Whom would it hurt, and whom would it help? d) Under what conditions is a congestion tax a good idea?

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