This presentation is part of: R10-1 Urban and Regional Economics

Tolls, Exchange Rates, and Borderplex Bridge Traffic

Thomas M. Fullerton Jr., Ph.D. and Angel L. Molina Jr., M.S. Economics & Finance, University of Texas at El Paso, 500 West University Avenue, El Paso, TX 79968-0543

Although there have been a small number of empirical studies that examine northbound border crossings between Mexico and the United States, very few examine the potential impacts of both tolls and exchange rates on the various traffic categories.  This effort attempts to partially fill that gap in the applied economics literature by modeling northbound traffic flows at one of the largest regional economies along the border.  Results indicate that business cycle fluctuations, variations in the real exchange rate, and changes in real toll tariffs all influence border crossings.  The results also indicate that real toll rates may play less of a role than might be expected.