The economics of motorist information systems revisited

The literature on the implications of the implementation of motorist information systems is ambiguous, particularly with respect to the economic consequences. This paper aims to shed more light on the potential economic costs and benefits of these new technologies by reviewing and combining results obtained in the literature. Furthermore, future research directions, essential for an increased understanding of these systems, are pointed out. It is first argued that a motorist information system is not a normal economic good; the benefits accruing to the equipped road users are dependent on the level of market penetration. At most levels of market penetration a motorist information system is most likely to generate a positive external effect for non‐equipped motorists and a negative external effect for those already equipped. However, in terms of travel time, the equipped road users will outperform the non‐equipped ones. Next, the economic consequences of these peculiarities are identified, particularly wit...

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