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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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