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VI. CONCLUSION

In the final analysis, the fundamental policy issue does not seem to be whether roads should be privatized, since many thinkers and planners are leaning towards private solutions, but to what extent they should be privatized. Semi-privatization schemes are often considered to be "privatization", but in reality they are only a partial leap. Many links to, and problems associated with, the political process remain under semi-privatization schemes. Given the struggles surrounding Costanera Norte, a case of government failure, it is not clear that maintaining a role for government in the process is the most beneficial approach.

Allodial policy would make plenary privatization possible, eliminating public choice and knowledge problems, along with many political conflicts or obstreperous dissent associated with semi-privatization schemes. It would likely reduce the costs for contractors, and thus consumers, since government regulation would not exist. Table 2 provides a summary of many pertinent issues under each highway policy option.

Table 2: Summary of fifteen key issues under three public policy options for highway production

Policy issue
Direct Provision Semi-Privatization Allodial Policy
Automatic tendency toward cost-efficiency (in money spent) No No Yes
Central control and route selection Yes Yes No
Coercive condemning of property Yes Yes No
Congestion pricing can be used Yes Yes Yes
Equity concerns would likely rise No No Yes
Externalities handled by market only No No Yes
Funded by direct taxes primarily Yes No No
Government bears some/entire risk Yes Yes No
May generate political turmoil Yes Yes No
Monopoly might be a concern Yes Maybe Yes
Regulatory capture a possible problem Yes Yes No
Requires regulating bureaucracy Yes Yes No
Requires toll/fee-for-service roads No Yes Yes
Self-interest likely yields social benefits No Maybe Yes
Tries subordinating private interests in favor of public ones Yes Yes No

It might be that allodialism is the foremost policy solution for modern infrastructure development. However, since allodial policy is not likely to be adopted in the foreseeable future, one could argue that semi-privatization policy should be pursued in the short run. Even so, given the theoretical criticisms and practical problems associated with semi-privatization, it is worthwhile to consider allodial policy as a pure basis for market provision of highways and to include it as an option in infrastructure policy models.

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