Final answer:
Road user costs include direct, indirect, and intangible costs related to the use of road networks. The 'free rider problem' signifies that not all users contribute to the maintenance of public goods such as roads, leading to collective action problems. Toll roads help finance infrastructure but can increase traffic and administrative expenses.
Step-by-step explanation:
Road user costs refer to the expenses incurred by individuals and businesses due to using road networks. These costs can be categorized into different types: direct costs, which include fuel, vehicle maintenance, and tolls; indirect costs such as time lost due to traffic delays and vehicle depreciation; and intangible costs, which are more difficult to quantify and include stress and the risk of accidents.
The concept of 'free rider problem' is related to how public goods, like roads, are funded. Since it is challenging to exclude non-payers from using these facilities, not everyone contributes equally to their upkeep. This issue can result in a collective action problem, where the benefits of the road are shared among all, but the contribution to its construction and maintenance is unequal. Toll roads are one mechanism used to offset construction and maintenance costs, requiring users to pay a fee, which can also have drawbacks such as increased traffic congestion and higher administrative expenses.
Transportation planning must strike a balance between developing new roadways, upgrading existing ones, and ensuring an efficient flow of traffic, all while considering the benefit-cost ratio of these investments and the potential for recidivism in traffic congestion and infrastructure deterioration.