Congestion Pricing Impact in Manhattan
Analyzing the effect of NYC's congestion pricing program on taxi and rideshare traffic in the Manhattan Central Business District.
What is Congestion Pricing?
NYC congestion pricing is a $9 toll on vehicles entering Manhattan's Central Business District (south of 60th Street) during peak hours. It took effect on January 5, 2025 — the first program of its kind in the United States. London and Stockholm have operated similar systems for years.
Who pays
- Private cars ($9 peak, less off-peak)
- Uber, Lyft, and other FHVs ($9 toll passed to riders)
- Trucks ($14–$36 depending on size)
Who is exempt or discounted
- Yellow taxis (pay $1.25/ride surcharge instead)
- Buses and emergency vehicles
- Low-income drivers (discounts available)
Why it exists
- Reduce gridlock in Midtown/Downtown
- Fund MTA subway & bus improvements (~$1B/year)
- Improve air quality by reducing vehicle emissions
Originally proposed in 2007, passed by the state legislature in 2019, and delayed until 2025 due to environmental review and political disputes. The toll was reduced from the originally planned $15 to $9 by Governor Hochul.
Mode Shift: Yellow Taxi vs FHVHV (Uber/Lyft)
Monthly trips (thousands) in the Manhattan CBD. Vertical line marks congestion pricing start.
Difference-in-Differences: CBD vs Control Groups
Trip volume indexed to Jan 2023 = 100. If congestion pricing reduced CBD traffic, the blue line should diverge below the control groups after the policy date.
Month-to-Month: CBD Trips by Type
Monthly trip volumes (millions) in the congestion zone by taxi type. Vertical line marks congestion pricing start.
Methodology
Treatment group: TLC taxi zones within the Manhattan Central Business District (south of 60th St) — 52 zones.
Control groups: Upper Manhattan (14 zones above 60th St) and Brooklyn (60 zones) — areas not subject to the congestion toll.
Approach: Difference-in-differences comparing year-over-year growth rates. If the toll reduced CBD traffic, we expect CBD growth to lag control groups after Jan 2025.
Limitations: TLC data covers only for-hire vehicles (taxis & rideshare), not private cars, trucks, or buses. Yellow taxis are largely exempt from the surcharge, creating a natural within-group comparison.