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Teaching activity

In the News Teaching Activity – Paris votes to increase the parking fees for SUVs to reduce pollution (Feb 2024)

Elizabeth Veal

8th February 2024

Following the banning e-scooters in Paris, the Mayor of Paris has led a successful vote to increase parking fees for SUVs in central Paris to reduce pollution in the centre of the city.

Despite a low voting turnout (just 5.7% from 1.3 million eligible voters), Parisians have approved a threefold increase in parking rates for SUVs in inner Paris, with 54.55% of voters supporting the move. Socialist Mayor Anne Hidalgo initiated the vote, arguing SUVs are dangerous and environmentally harmful. The higher rates of €18 an hour mainly target suburban drivers entering the city. Exemptions include electric cars, taxis, tradespeople, healthcare workers, and people with disabilities. However, critics argue the SUV classification is misleading, and opponents view the surcharge as "punitive environmentalism." There are concerns that many family vehicles may be affected. The decision aligns with Paris's plan to become more bike-friendly, with 84 kilometres of cycle lanes created since 2020. It is hoped the city’s pollution will be lowered ready for this summer’s 2024 Paris Olympics.

Parisians vote for rise in parking fees for SUVs - BBC News

1 What market failure is the increase in SUVs parking fees designed to correct?

2 Using a marginal social benefit and cost diagram, show the welfare loss caused by the market failure of SUVs’ being ‘dangerous and bad for the environment.’

3 Evaluate the policy of charging SUVs higher parking charges in Paris.

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Elizabeth Veal

Liz has taught Economics for over 25 years, including several years as Head of Economics at leading schools.

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