Price-management of traffic congestion: Hong Kong's Lion Rock Tunnel

Kang Hua Cao*, Yuk Shing Cheng, Chi Keung Woo

*Corresponding author for this work

    Research output: Contribution to journalJournal articlepeer-review

    2 Citations (Scopus)
    47 Downloads (Pure)


    Hong Kong drivers face rush-hour traffic congestion at the Lion Rock Tunnel (LRT) which interconnects the Northeast New Territories and the Kowloon Peninsula. The LRT's flat toll is HK$8 (≈US$1.03), much lower than the Tate's Cairn Tunnel's (TCT's) vehicle-differentiated tolls of HK$13 to HK$34 per vehicular trip. We develop two proposals to raise the LRT's toll and reduce the TCT's tolls. Using the monthly data available from the Hong Kong Transport Department for the 15-year period of 2000–2014, we estimate a Generalized Leontief demand system to document statistically significant (p-value < 0.05) tunnel usage responses to these toll proposals. As the two tunnels’ elasticity estimates vary by traffic direction, a directional toll proposal may further ease the LRT's rush-hour congestion. Hence, Hong Kong can price-manage the LRT's congestion because a decrease in the LRT's total usage likely reduces the LRT's peak usage that occurs during the rush hours.

    Original languageEnglish
    Pages (from-to)699-706
    Number of pages8
    JournalCase Studies on Transport Policy
    Issue number4
    Publication statusPublished - Dec 2017

    Scopus Subject Areas

    • Geography, Planning and Development
    • Transportation
    • Urban Studies

    User-Defined Keywords

    • Hong Kong
    • Lion Rock Tunnel
    • Revenue-neutral toll proposals
    • Traffic congestion
    • Transportation demand management


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