This paper looks at the changes that have occurred since the 1970s in the types of economic tools used, the ways they have been used, and the impacts they have had in shaping the way we now understand transportation. Over the past 30 years, society’s views on transport have changed and, with this, the issues to which we attach priority have altered. Additionally, there have been important changes in our more generic understanding of economics and this has added to the toolkit of concepts that can be applied to transport matters. The tradition of transportation economics up until the late 1960s was largely one of defining ‘optimal’ pricing principles in regulated markets, in understanding market domination for mergers and similar policies, and in providing advice to engineers dealing with investment decisions. There is now, however, an appreciation that providing transport services is more complex than was once thought and, therefore, it is better to leave as much as possible to market forces; but this has also happened at a time when our understanding of markets has changed. There has additionally been the emergence of novel political and governance structures, such as the Single European Market, that have resurrected older interests in such things as links between economic development and transport quality. Despite this shift to the market as a primary means of resource allocation, parallel moves have taken place to embrace more fully the external costs of environmental damage. The advent of computers, more sophisticated econometric and programming techniques, and the availability of new data sources, such as GIS, have facilitated more efficient estimation of parameters and added to the quantitative contribution of economics.