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Congestion pricing, often referred to as congestion pricing or cordon pricing, is a traffic management strategy designed to reduce traffic congestion in urban areas by charging drivers fees to enter or drive within high-demand zones. The concept relies on economic incentives to discourage non-essential vehicle use during peak hours, thereby improving traffic flow, reducing emissions, and enhancing public transportation efficiency.

The implementation of congestion pricing typically involves establishing a geographic boundary, often centered around a city’s core, where vehicles must pay a fee to enter or drive. The fees are usually higher during peak hours and lower or waived during off-peak periods. Electronic toll collection systems, such as transponders or license plate recognition, are commonly used to enforce and collect payments automatically.

One of the most well-known examples of congestion pricing is the Congestion Charge in London, introduced in 2003. Since then, similar systems have been adopted in cities like Stockholm, Singapore, and Milan. Proponents of congestion pricing argue that it reduces traffic congestion, lowers air pollution, and generates revenue that can be reinvested in public transportation or infrastructure improvements. Critics, however, raise concerns about equity, potential unintended economic impacts on businesses, and the effectiveness of the system in low-density or sprawling urban areas.

Congestion pricing is often accompanied by complementary measures, such as expanded public transit options, bike lanes, and pedestrian-friendly infrastructure, to ensure that the reduction in private vehicle use leads to sustainable and equitable urban mobility solutions. The success of such programs depends on public acceptance, proper planning, and the ability to balance economic, environmental, and social objectives.