2016 Transportation Economics

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Academic unit or major
Graduate major in Civil Engineering
Fukuda Daisuke 
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Course description and aims

This course teaches how principles of economics can be applied to evaluate the effects of transportation plans and/or policies.

Student learning outcomes

By the end of this course, students will understand the economic framework to analyze the supply and demands for transportation.


Economics, Microeconomics, Transportation Economics, Transport Policy, Cost Benefit Analysis, Urban Economics

Competencies that will be developed

Specialist skills Intercultural skills Communication skills Critical thinking skills Practical and/or problem-solving skills

Class flow

While teaching theoretical foundations of microeconomics, four assignments will be given to students. Final exam or final presentation will be conducted.

Course schedule/Required learning

  Course schedule Required learning
Class 1 Introduction of Economic Theory for Transportation Studies - Aims & Scopes of this Course - Introduction to Microeconomics
Class 2 Transportation Demand: Case of Divisible Goods Basic concepts of Consumer Behavior Theory -Preferences -Utility -Choice -Elasticity, Income effect, Substitute/Complementary -Indirect utility -Welfare measures (Consumer surplus, EV, CV)
Class 3 Transportation Demand: Case of Discrete Goods - Discrete choice model - Travel mode choice - Value of travel time
Class 4 Firm Production and Cost in Transportation - Production technology - Production costs - Transportation costs
Class 5 Congestion Pricing: Theory and Practice - Fundamentals of static congestion pricing - Fundamentals of dynamic congestion pricing - Practices of congestion pricing
Class 6 Emergence of Cities and Agglomeration - Economics of agglomeration - Location choice and transport cost
Class 7 Land Use Pattern in a City: Urban Spatial Structure - Land use pattern - Bid-rent curve


Lecture materials will be uploaded and delivered via OCWi

Reference books, course materials, etc.

Varian, H.R. “Microeconomic Analysis,” Norton, 1992.
McCarthy, P. “Transportation Economics,” Blackwell, 2001.
Small, K. and Verhoef, E. “The Economics of Urban Transportation,” Routledge, 2007.
Jara-Diaz, S. “Transport Economic Theory,” Elsevier, 2007.
Brueckner, J. “Lectures on Urban Economics,” The MIT Press, 2011.

Assessment criteria and methods

- Assignments (40%)
- Final exam or final presentation (60%)

Related courses

  • CVE.D311 : Public Economics
  • CVE.D201 : Fudamentals of Infrastructure Planning
  • CVE.D401 : Mathematical Modeling of Individual Choice Behavior
  • CVE.D402 : Transportation Network Analysis
  • IEE.B201 : Microeconomics I
  • IEE.B202 : Microeconomics II
  • IEE.B401 : Advanced Microeconomics

Prerequisites (i.e., required knowledge, skills, courses, etc.)

Particularly not.

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