Hub location in the South-Atlantic airline market: A spatial competition game

The paper analyzes the airlines’ hub location problem through a spatial competition game played in two stages. First, airlines sequentially choose the location of their hub and second, they compete offering direct or connecting services between each city-pair. Different outcomes in the first stage will affect competition in the second, and as a consequence, the market share that airlines can obtain.Given actual demand patterns, results of the model are applied to the South-Atlantic airline market. We study the subgame perfect equilibriums obtained as a result of competition in each city-pair to anticipate where airlines will probably locate their hubs once an “open skies” policy is adopted in this market.     

IAME 2011 – contemporary studies on maritime transport in Latin America

Latin America and the Caribbean have evolved as a region of increased interest for the maritime and port industry as well as for academic research. Maritime transport activity in the region has experienced sustained growth rates over the last decades, resulting in ever-increasing demand for maritime services and port infrastructure. At the 2011 Annual Conference of the International Association of Maritime Economists (IAME), Latin America received significant attention. This editorial responds to growing research by giving a brief overview of the current situation and contemporary issues in maritime transport within the region. It also introduces the six selected papers for this Special Issue.     

The impact of compliance measures on the operation of a bus system: The case of Transantiago

In a regulated bus system operated by private companies, pecuniary incentives can be of primary importance to ensure the quality of the operation and the level of service, especially when there are only a few companies and basically no competition among them. The case of Transantiago, in the capital city of Chile, provides a good example of this. The very ambitious Transantiago project, implemented in 2007 in Santiago, integrated the bus and the subway systems, changing the route structure of the bus services, introducing a common and integrated fare system and electronic payment device, and tendering the operation of approximately 4,600 buses (which by the launch of the system in February 2007 had increased to 5600) to 10 private companies replacing some 4000 small operators which owned 8000 buses. In the beginning, the system faced huge difficulties. Operators' revenue formula basically consisted of a fixed payment, which changed slightly with the actual patronage. This quickly turned out to be a problem, and as technological support became available (several months after the launch), compliance measures were implemented, directly affecting the operators' revenue. The first measure considered the seat/standing places per hour of the buses in operation, for each company, and compared it to the theoretical figure. As a result, buses operating during peak hours increased from 4600 to 5600 in just two months. Subsequent indexes included service frequency and regularity, as well as effective bus-km, aggregated by company first and later by service. This paper shows how the successive implementation of these performance indexes had an impact on the operation of Transantiago in the first years, discusses the difficulties faced to implement them and highlights the importance of technological support to make possible the application of adequate compliance measures.     

Market Orientation in Public Transport Research—A Review

It is commonly argued that, in order to meet increasing competition, public transport organizations and systems need to be market oriented. Even though the notion of market orientationhas not been explicitly addressed in public transport research, studies relevant to market orientation have been conducted. The aim of this paper is to introduce the concept of market orientation into the field of public transport, to review previous research into market orientation in public transport research, and to suggest directions for future research. Market orientation is defined as the generation and dissemination of market intelligence by organizations, as well as responses to it. The review suggests that previous academic research has focused on intelligence generation by developing and using models for measuring travel behaviour, stated preferences, perceived customer quality, and satisfaction. Studies of responsiveness have mainly addressed the physical improvements made in public transport organizations, which is also the primary concern of the industry research accounted for. There has been less research into the dissemination of market intelligence, the drivers of market orientation, the relations between the elements, and the overall concept of market orientation in public transport. It is thus concluded that future public transport research needs to address these issues.     

Incorporating Logistics in Freight Transport Demand Models: State-of-the-Art and Research Opportunities

Freight transport demand is a demand derived from all the activities needed to move goods between locations of production to locations of consumption, including trade, logistics and transportation. A good representation of logistics in freight transport demand models allows us to predict the effects of changes in logistics systems on future transport flows. As such it provides better estimations of the costs of interaction and allows to predict changes in spatial patterns of freight transport flows more accurately. In recent years, the attention for freight modelling has been growing and new research work has appeared aimed at incorporating logistics in freight models. In this paper we review the state of the art in the representation of logistics considerations in freight transport demand models. Our focus is on the service and cost drivers of changes in logistics networks and how these affect freight transport. Our review proceeds along a conceptual framework for modelling that goes beyond the conventional 4-step modelling approach. We identify promising areas for freight modelling that have an integrative function within this framework, such as spatial computable general equilibrium models, supply chain choice models and hypernetwork models.     

Assessment of Cross‐Border Spillover Effects of National Transport Infrastructure Plans: An Accessibility Approach

Abstract

Traditional transport infrastructure assessment methodologies rarely include the full range of strategic benefits for the transportation system. One of these benefits is the contribution to cross‐border integration, critical for the European integration process. However, this is a key issue in strategic planning and decision‐making processes, as its inclusion may increase the probability of large‐scale transport infrastructure projects being funded. This paper presents a methodology for the measurement of the contribution of transport infrastructure plans to European integration. The methodology is based on the measurement of the improvement in network efficiency in cross‐border regions of neighbouring countries, via accessibility calculations in a Geographical Information System support. The methodology was tested by applying it to the ambitious road and rail network extensions included in the Spanish Strategic Transport and Infrastructure Plan (PEIT) 2005–2020. The results show significant and important network efficiency improvements of the PEIT outside the Spanish border. For the road mode, while the Spanish average accessibility improvement accounts for 2.6%, average improvements in cross‐border regions of France and Portugal are of 1.8%. And for the rail mode, the corresponding Spanish value is 34.5%, whereas in neighbouring regions it accounts for 20.2%. These results stress the significant importance of this strategic benefit and the consequent need for its inclusion in strategic planning processes. Finally, the paper identifies the potential of the methodology when applied at different administrative levels, such as the local or state levels.     

Transaction Costs in Transport Public–Private Partnerships: Comparing Procurement Procedures

Abstract

In recent years, concern has grown over good practices in the procurement process in public–private partnerships (PPPs). The consensus view is that PPPs are prone to higher transaction costs than traditional public provision. In this paper, we contrast the hypothesis that transaction costs in transport PPPs depend, to a large extent, on the procurement mechanism used in each case, comparing the Negotiated and the Open procedures. Given that PPPs may offer considerable benefits and significant savings over the entire life cycle of the project, it is essential for PPPs to minimize those costs that undermine efficiency gains and that deter private involvement. The quantitative analysis undertaken in this paper highlights that there is room for important savings in the tendering of PPP transport infrastructure projects, using an Open procedure.     

Lightweight Occupancy Estimation on Freeways Using Extended Floating Car Data

Advanced traffic management systems rely heavily on technology to perform accurate estimations of the current state of the traffic as well as its short-term evolution. The objectives are improving traffic flow and enhancing road safety. Their success is based on accurate monitoring of two key variables, specifically speed and occupancy. The latter of the two has, to date, received significantly less attention from the scientific community. In this work we present a lightweight method to perform “on-line” occupancy estimation. We first propose three occupancy measurements calculated from data collected by a floating car: vehicle count, percentage of stop time, and headway. We then extend these discrete values to a continuous estimation of occupancy in space and time. The proposed estimators are based on a pairwise linear regression of each of the previously calculated measurements over certain references obtained from other floating cars or magnetic loop detectors. The method has been calibrated and validated under real traffic conditions and data. Despite the ease of implementation, the method is able to reproduce the occupancy values generated by the actual loop detectors, achieving promising results, with estimation errors down to 6.52%, even before multivehicle systems are considered.     

Preference Heterogeneity and Willingness to Pay for Travel Time Savings

We examined different model specifications to detect the presence of preference heterogeneity in a mode choice context. The specification that worked best allows for both systematic and random variations in tastes, with parameters obtained at the individual level using Bayesian methods. Subjective values of travel time (SVT) and expected individual compensated variation were derived and aggregated to obtain measures of social welfare. Results suggest that the benefit measures, both at the individual and at the social level, are sensitive to preference heterogeneity assumptions. SVT and welfare changes derived from travel time reductions could be underestimated if the traditional assumption of taste homogeneity is made (we detected differences up to 30% in both types of measures). We also obtained an empirical value for the error made when evaluating changes in social welfare using an approximation of the expected individual compensated variation (expressed as a function of individual SVT) rather than its exact expression.