Regulation of the informal transport sector in Rio de Janeiro,Brazil: welfare impacts and policy analysis

In Brazil, the explosion of informal transport activity during the past decade has had profound effects on formal public transport systems and is a source of great controversy in the urban transportation sector. A variety of policies have been proposed to manage the growth of the sector. This study seeks to understand how proposed policies will impact the users of these systems. A corridor in Rio de Janeiro with substantial informal activity was used as a case study. Measures of welfare changes in a discrete choice framework were used to estimate proposed policies’ impacts on users. Eleven candidate policies were evaluated, ranging from the eradication of the informal modes and investment in formal modes, to the legalization of the informal modes. Benefits were compared with costs and the distribution of benefits across income classes was explored. Net benefits from some policies were found to be substantial. Legalizing the informal sector was found to benefit users slightly but further investments in the sector are probably inefficient. Users benefited most from improvements in formal mass transit modes, at roughly 100–200 dollars per commuter per year. Finally, policies to foster a competitive environment for the delivery of both informal and formal services were shown to benefit users about 100 dollars per commuter per year. Together, the regulation of the informal sector and investments in the formal sector serve to reinforce the movement towards competitive concessions for services and help reduce the impacts of cartelization and costly in-road competition.

The value of service reliability

This paper studies the impact of service frequency and reliability on the choice of departure time and the travel cost of transit users. When the user has (α, β, γ) scheduling preferences, we show that the optimal head start decreases with service reliability, as expected. It does not necessarily decrease with service frequency, however. We derive the value of service headway (VoSH) and the value of service reliability (VoSR), which measure the marginal effect on the expected travel cost of a change in the mean and in the standard deviation of headways, respectively. The VoSH and the VoSR complete the value of time and the value of reliability for the economic appraisal of public transit projects by capturing the specific link between headways, waiting times, and congestion. An empirical illustration is provided, which considers two mass transit lines located in the Paris area.     

Airline network choice and market coverage under high-speed rail competition

While the existing literature has focused on the short-term impacts, this paper investigates the long-term impacts of high-speed rail (HSR) competition on airlines. An analytical model is developed to study how an airline may change its network and market coverage when facing HSR competition on trunk routes. We show that prior to HSR competition, an airline is more likely to adopt a fully-connected network and cover fewer fringe markets if the trunk market is large. Under HSR competition, the airline will, for a given network structure, have a greater incentive to cover more fringe (regional or foreign) markets if the trunk market is large, or the airline network is close to hub-and-spoke. Further, the airline will, for any given market coverage, move towards a hub-and-spoke network when the trunk market is large, or the number of fringe markets covered by the airline network is large. Both effects are more prominent when the decreasing rate of airline density economies is large. We further show that HSR competition can induce the airline to adopt network structure and market coverage that are closer to the socially optimal ones, thereby suggesting a new source of welfare gain from HSR based on its long-term impacts on airlines. Implications for operators, policy makers and specific countries (such as China) are also discussed.     

Evaluating the long term impacts of transport policy: The case of passenger rail privatisation

Britain's national rail system was ‘privatised’ as a result of the 1993 Railways Act, with most of the organisational and ownership changes implemented by 1997. This paper examines the long term impacts of these changes. A key issue when examining long term changes is that of the counterfactual – what would have happened if the changes had not occurred? A simple econometric model of the demand for passenger rail services was developed and used in conjunction with extrapolative methods for key variables such as fares and train km to determine demand-side counterfactuals. Extrapolative methods were also used to determine counterfactual infrastructure and train operation costs. Although our results are sensitive to the assumptions we have made concerning the counterfactual they suggest a number of impacts. Since privatisation, rail demand has grown strongly but our analysis indicates that transitional disruptions suppressed demand by around 9% over a prolonged period (1992/3 to 2005/6), whilst the Hatfield accident reduced demand by about 5%, albeit over a shorter period (2000/1 to 2006/7). A welfare analysis suggests that although consumers seem to have gained as a result of privatisation, for most years this has been offset by increases in costs. An exception is provided by the two years immediately before the Hatfield accident. Overall the loss in welfare since the reforms were introduced far exceeds the net receipts from the sale of rail businesses. Thus although the reforms have had advantages in terms of lower fares and better service levels than otherwise would have been the case, this appears to have been offset by increased infrastructure and train operations costs. The source of these high costs remains an area of speculation but appear to be related to aspects of both market and regulatory failure.     

Evaluating the long term impacts of transport policy: An initial assessment of bus deregulation

Local buses in Britain, outside London, were ‘deregulated’ as a result of the 1985 Transport Act, with most of the organisational changes implemented in 1986 but many of the ownership changes occurring over a longer period. By contrast, in London, the 1984 London Regional Transport Act introduced a system of comprehensive tendering – but it took 10 years for the organisational and ownership changes to be fully implemented. This paper examines the long term impacts of these changes. A key issue when examining long term changes is that of the counterfactual – what would have happened if the changes had not occurred? An econometric model of the demand for local bus services in Britain is outlined and used in conjunction with extrapolative methods for key variables such as fares and bus kms to determine demand-side counterfactuals. Some analyses of subsidy and of costs will also be outlined. This will then permit the examination of welfare change by estimating changes in consumer and producer surpluses, updating earlier studies. It is found that outside London, bus demand declined strongly, at least up to the year 2000 and some of this reduction can be ascribed to deregulation. By contrast in London, demand has generally been increasing. However, in both areas operating costs also declined strongly, again up to 2000, but since then there have been strong increases in costs and subsidy. Our initial finding is that there are net welfare increases both outside and inside London, but with welfare increases per capita being five times greater in London than elsewhere. However, sensitivity analysis shows that our results are sensitive to the specification of the modelling system and assumptions made concerning the counterfactual, particularly for the results for London.     

Rationing and pricing strategies for congestion mitigation: Behavioral theory,econometric model,and application in Beijing

Some travel demand management policies such as road pricing have been widely studied in literature. Rationing policies, including vehicle ownership quota and vehicle usage restrictions, have been implemented in several megaregions to address congestion and other negative transportation externalities, but not well explored in literature. Other strategies such as Vehicle Mileage Fee have not been well accepted by policy makers, but attract growing research interest. As policy makers face an increasing number of policy tools, a theoretical framework is needed to analyze these policies and provide a direct comparison of their welfare implications such as efficiency and equity. However, such a comprehensive framework does not exist in literature. To bridge this gap, this study develops an analytical framework for analyzing and comparing travel demand management policies, which consists of a mathematical model of joint household vehicle ownership and usage decisions and welfare analysis methods based on compensating variation and consumer surplus. Under the assumptions of homogenous users and single time period, this study finds that vehicle usage rationing performs better when relatively small percentages of users (i.e. low rationing ratio) are rationed off the roads and when induced demand elasticity resulting from congestion mitigation is low. When the amount of induced demand exceeds a certain level, it is shown analytically that vehicle usage restrictions will always cause welfare losses. When the policy goal is to reduce vehicle travel by a fixed portion, road pricing provides a larger welfare gain. The performance of different policies is influenced by network congestion and congestibility. This paper further generalizes the model to consider heterogenous users and demonstrates how it can be applied for policy analysis on a real network after careful calibration.     

Achieving political acceptability for new transport infrastructure in congested urban regions

This paper analyzes the efficiency and political acceptability of road pricing and infrastructure policies targeted at relieving urban congestion. It combines a stylized transport model of an urban road network with a model of the political process that incorporates interactions between voters, citizen interest groups and politicians to explore the possibilities to reach political acceptability for efficient transport policies. In a numerical illustration, the paper compares a set of pricing and investment policies in terms of efficiency and acceptability. The illustration shows how conflicting interests can lead to non-efficient policies being chosen.     

北京市公共交通发展模式对长沙市的启示

本文通过对北京市“公益性”公共交通发展模式及其特点的借鉴,探讨了长沙市当前在公共交通民营化过程中存在公交票价标准不一、公交企业内部存在“寻租”等一系列问题,并得出了应从加大财政扶持力度、提高公共责任意识、充分发挥社会监督作用等方面来完善长沙市公共交通的启示。     

Demand and welfare effects in recreational travel models: Accounting for substitution between number of trips and days to stay

In this paper we present a non-linear demand system for households’ joint choice of number of trips and days to spend at a destination. The approach, which facilitates welfare analysis of exogenous policy and price changes, is used empirically to study the effects of an increased CO₂ tax. In particular, we focus on the effect of including substitution between households choice of the number of trips and days to spend at a destination in the welfare analysis. The analysis reveals that the equivalent variation (EV) measure, for the count data demand system, can be seen as an upper bound for the households welfare loss. Approximating the welfare loss by the change in consumer surplus, accounting for the positive effect from longer stays, imposes a lower bound on the households welfare loss. The difference in the estimated loss measures, from the considered CO₂ tax reform, is about 20%. This emphasizes the importance of accounting for substitutions toward longer stays in travel demand policy evaluations.     

Cost-benefit analysis according to Sen: An application in the evaluation of transport infrastructures in France

Made compulsory in France for major transport infrastructures, cost-benefit analysis is constantly being improved to achieve the best socio-economic evaluation possible. According to the philosopher and economist Amartya Sen, this analysis should meet two requirements: one ethical, the other democratic. We will examine the evaluation procedure in France and highlight the gap between its officially more democratic character and its still insufficiently ethical character, from the viewpoint of this dual requirement.