The Short-Run Effects of Congestion Pricing in New York City (Cook, Kreidieh & Vasserman et al.)

Summary

"The Short-Run Effects of Congestion Pricing in New York City," by Cody Cook, Aboudy Kreidieh, Shoshana Vasserman, Hunt Allcott, Neha Arora, Freek van Sambeek, Andrew Tomkins and Eray Turkel (NBER Working Paper 33584, March 2025, revised January 2026), is the first rigorous causal evaluation of New York City's Central Business District (CBD) Tolling Program — the first cordon-based congestion pricing scheme in the United States, launched January 2025. It brings the congestion-pricing evidence base, long dominated by Singapore, London, Stockholm and Milan, to a North American megacity, using measured trip data and a modern research design. It is a working paper (not yet peer-reviewed), authored by a Stanford/Yale/Google-Research team.

Key Findings

• CBD speeds rose 11%. "Using a generalized synthetic controls approach that compares outcomes in NYC to contemporaneous outcomes in other cities, we find that the policy increased speeds on CBD roads by 11%, with little-to-no effect on air quality, transactions at shops and restaurants, or overall foot traffic in the CBD."[1]
• Metro-wide spillovers. "Speeds also increased outside the CBD, especially on roads commonly traversed by drivers traveling to/from the CBD. These spillovers lead to faster trips throughout the metro area, including for many unpriced trips."[1]
• Positive driver welfare, before revenue or environmental benefits. "If drivers have a Value of Travel Time (VOTT) of $40/hour, then we estimate that driver welfare increased by at least $14.3 million/week, before any revenue recycling or environmental benefits."[1] The gains are "largely driven by diffuse time savings for the many unpriced trips outside the CBD, highlighting the importance of accounting for network-wide spillovers."[1]
• Break-even framing. Passenger vehicles headed to the CBD "are only better off if their VOTT exceeds $153/hour, but the modest speed improvements for the many unpriced trips reduce the overall 'break-even' VOTT of these drivers to at most $21/hour."[1]

What It Supports

• Congestion pricing reduces traffic and congestion — the newest and first-in-the-US case, and one of the cleanest for network-wide welfare. It confirms the core traffic result (speeds up 11% in the priced zone) with a synthetic-control design on measured data, and — like Stockholm's cost-benefit analysis — finds the scheme net-positive for drivers even before counting the toll revenue or any environmental gain, precisely the wasted-time deadweight loss the Geoist reading says a scarcity charge recovers.

What It Cuts Against / Honest Limits

• Working paper, short run. These are short-run effects from a not-yet-peer-reviewed study; longer-run and peer-reviewed estimates should be checked as they appear.
• Little-to-no air-quality effect. Unlike Milan (where an Area C suspension let pollution be measured to fall 6–17%), NYC's early window shows "little-to-no effect on air quality" — a reminder that the traffic-speed benefit and the pollution benefit are distinct and need not both show up in the short run.
• Distribution across drivers. The break-even VOTT results show the gains are unevenly distributed — CBD-bound passenger vehicles need a high value of time to come out ahead; the aggregate gain is carried by diffuse time savings on unpriced trips.

Bears On

• Outcome: Congestion pricing reduces traffic and congestion
• Concept: Congestion Pricing
• Concept: Pigouvian Taxation
• Research: The Stockholm congestion-charging trial 2006 (Eliasson et al.) — the earlier measured-data welfare case this parallels

See Also

• Congestion pricing reduces traffic and congestion
• Congestion Pricing
• The Stockholm congestion-charging trial 2006 (Eliasson et al.)
• Road pricing, driver behaviour and air pollution: Milan (Gibson & Carnovale)

Sources

1. Cody Cook, Aboudy Kreidieh, Shoshana Vasserman, Hunt Allcott, Neha Arora, Freek van Sambeek, Andrew Tomkins & Eray Turkel (2025), "The Short-Run Effects of Congestion Pricing in New York City," NBER Working Paper 33584 (March 2025, revised January 2026). DOI 10.3386/w33584 — used for the 11% CBD-speed increase, the metro-wide spillover to unpriced trips, the ≥$14.3 million/week driver-welfare gain (at $40/hour VOTT, before revenue/environmental benefits), and the break-even-VOTT framing; abstract quotations verified verbatim against the NBER and author-hosted PDFs this session.