Mason Lauds Owen for Judicial Treatment of Highway Economics in Phi Beta Kappa Essay

This review of the Phi Beta Kappa Prize Essay, "A Study in Highway Economics," by Wilfred Owen '34, is written by Edward S. Mason, associate professor of Economics. The essay is published today.

The author and the Harvard chapter of Phi Beta Kappa are to be congratulated upon the publication as the first essay in a series, which we hope will be granted a long and prosperous life, of as clear-cut and careful a piece of work as this. The literature on the subject of highway economics, though there are exceptions, has so far generated more heat than light. Amid dozens of confused and muddle-headed publications in this field, it is pleasant to come upon a study in which the problems are not only seen but seriously attacked.

Mr. Owen treats substantially three problem of highway costs and cost allocation, and the question of motor vehicle taxation. In connection with the first group he illuminates the matter by viewing a highway as a production plant turning out a commodity--vehicle miles types of problems: those connected with the production of highway services, the and presenting much the same problems of size, location, and production process, i.e., type of road construction, as economists are accustomed to deal with in their theory of production. So neatly is this done is fact that the question arises whether, perhaps, the aualogy is not a trifle overdone. Surely the theory of industrial location, for example, has little to contribute to the question of highway location. This is, however, a minor matter. Consideration of the highway as a production unit enables the author to break new ground and to apply to highway economics a technique of economic analysis which has proved its usefulness elsewhere.

The discussion of the difficult questions of highway cost and cost allocation is equally acute. The problem is essentially one of read classification on the basis of benefits dispensed and to whom. Mr. Owen properly objects to the enstemary classification of roads into vehicle use highways and local use highways with their various sub-groups on the ground that it is too simple to reflect accurately the reality of the situation. He is not, however, prepared to advance an alternative classification of his own, contenting himself rather with the observation that such a classification will only be practicable after extensive traffic surveys.

The section on Motor Vehicle Taxation finds the author battling vigorously and, on the whole, successfully against the waves of propaganda launched by railway and automotive interests. He is able to show conclusively the nature of the mistakes made by both groups in their respective answers to the question "who pays the cost of road building and maintenance?" It appears clearly from the analysis "that motor vehicle taxes are not taxes at all, and that traffic on the highways is largely government subsidized." Nevertheless the question whether the vehicle highway plant is in the same position as the highway plant is in the same position as the railway road-bed and should be treated in the same way by taxing authorities is left, at least partially, hanging in the air.

Mr. Owen's style, while not as yet distinguished, is adequate for the purpose. The argument moves along clearly and succinctly and the book may well be taken as a model treatment of the sort of question it attempts to handle