Certificate of entitlement : policy and its effects

• Main Authors: Chiang, Cheng Yee, Oh, Sok Cheng, Yak, Sock Cheng
• Other Authors: Mike Leu Gwo-Jiun
• Format: Final Year Project
• Language: English
• Published: 2015
• Subjects: DRNTU::Business::General::Government policies
• Online Access: http://hdl.handle.net/10356/63997
• Institution: Nanyang Technological University

Singapore is a small country with limited land. If there are no controls on the growth of vehicle population, there may come to a stage when the roads available are not enough for usage, resulting in severe traffic congestion. The latest measure - the Certificate of Entitlement (COE) system was introduced in May 1990 in an effort to curb traffic congestion in Singapore. The transport policies prior to the implementation of the COE system have not proven successful in their attempts at curbing traffic congestion. The growth in vehicle population was still increasing. The COE system, however, sets a limit for the growth of vehicles at 4% per annum to restrict car ownership in Singapore. Since implementation, the trend in COE prices has been increasing, due to several demand and supply factors. The main objective of our study is to examine the impact of the COE system on consumers, car dealers and the government. Decisions to buy a car have been affected by the COE system as the cost of new cars has increased substantially. Car dealers also have to promote themselves more aggressively in order to maintain their competitiveness in the market. On the other hand, the government is able to achieve its aim of controlling car growth. The introduction of the Electronic Road Pricing (ERP) system in 1996 will enable more COEs to be available as the restraining will be on usage rather than ownership. Traffic congestion is a problem in many countries. Singapore has currently chosen restraint on car ownership as the solution. Besides discussing the effectiveness of the COE system in solving traffic congestion problem, we will also be looking at some of the foreign countries traffic policies.