Parking Management and Low Emission Zones (LEZs) are two of the most widely applied policies to reduce the negative externalities of private vehicles in urban areas and, in particular, to prevent the incorrect use of public spaces and encourage drivers to use the parking service more efficiently. Recently, some cities have been adjusting these measures to the environmental characteristics of the vehicles, but up to date, there is little empirical evidence about the effectiveness of that measures. The objective of the paper is to explore to what extent Parking Management and the implementation of LEZs reduce the parking demand of the most polluting vehicles. Based on a detailed database obtained from parking payment records (more than 50 million) in Madrid (Spain), a spatial econometric approach is conducted to analyze the impact of both policies on parking demand. Our analysis indicates that implementing Parking Management and LEZ policies resulted in more efficient use of parking space by incentivizing the use of environmentally friendly vehicles and reducing demand for highly polluting ones. This was achieved through a combination of LEZ restrictions and parking fare incentives or penalties linked to the environmental label of the vehicle. Consequently, on-street parking became a more attractive option for clean vehicles. Interestingly, this study also found that this phenomenon significantly impacted overall parking behavior throughout the city, not just within the LEZ.
