Abstract:

Nowadays, traffic congestion is a serious problem in the city The purpose of this study is to find the inherent reasons that cause congestion, and to analyze the effectiveness of the car license allocation policy through two typical cities, Beijing and Shanghai Therefore, from the perspective of social cost and the allocation of property rights, the causes of traffic congestion are discussed Then, the quantitative economic model is constructed based on the new institutional economics to explore the different economic effects of current license plate allocation policy between Beijing and Shanghai It is found that the essential cause of traffic congestion is a problem related to the automobile usage and not an inventory problem The license plate restriction is only a temporary solution Finally, some suggestions based on the above research for traffic management are put forward

Key words: private car license plate distribution, property right, social cost, traffic congestion management