Do Economic Incentives Promote Physical Activity? Evidence from the London Congestion Charge. A new GLO Discussion Paper by GLO Fellow Andrea Albanese and colleagues.

Discussion Paper, News, Post, Post-22

A new GLO Discussion Paper reveals a statistically significant but small impact on active commuting (i.e. cycling and walking) around the border of the charging zone. The effect is larger for lower-income households and car owners. The findings are robust against multiple specifications and validation tests.

GLO Discussion Paper No. 1006, 2021

Do Economic Incentives Promote Physical Activity? Evidence from the London Congestion Charge – Download PDF
by Nakamura, Ryota & Albanese, Andrea & Coombes, Emma & Suhrcke, Marc

GLO Fellow Andrea Albanese

Andrea Albanese

Author Abstract: This study investigates the impact of economic incentives on travel-related physical activity, leveraging the London Congestion Charge’s disincentivising of sedentary travel modes via increasing the cost of private car use within Central London. The scheme imposes charges on most types of cars entering, exiting and operating within the Central London area, while individuals living inside the charging zone are eligible for a 90% reduction in congestion charges. Geographical location information provides the full-digit postcode data necessary to precisely identify the eligibility for the discount of participants in the London Travel Demand Survey for the period 2005-2011. Using a boundary regression-discontinuity design reveals a statistically significant but small impact on active commuting (i.e. cycling and walking) around the border of the charging zone. The effect is larger for lower-income households and car owners. The findings are robust against multiple specifications and validation tests.

GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS,  EconPapers). Complete list of all GLO DPs – downloadable for free.

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