Increased patronage for urban bus transport with net-cost contracts
2010 (English)Report (Other academic)
Simulations of net cost contracts augmented with a subsidy per passenger for public transport bus operators in Sweden indicate that such contracts may shift the operators profit maximising price and frequency combination in a direction that yields an increased patronage. The calculations suggest that a subsidised increase in patronage is welfare improving. The simulations unfortunately also indicate that such contracts may become very costly for the public transport authority. In a system with franchised contracts we however suggest that a large part of these costs may be recovered as a bid for the contract. In this study we can not calculate all the potential adaptations that the operator may undertake to optimise the supply. We therefore conjecture that a net cost contract augmented with a subsidy may well be a reasonable policy to achieve increased patronage.
Place, publisher, year, edition, pages
Stockholm: Statens väg- och transportforskningsinstitut, 2010. , 13 p.
CTS Working Paper, 2010:8
Contract, Financing, Method, Transport operator, Public transport, Passenger, Increase, Price, Profit
Avtal, Finansiering, Metoder, Transportörer, Kollektivtrafik, Passagerare, Ökning, Priser, Vinst
Research subject Road: Transport, society, policy and planning, Road: Public transport; Road: General works, surveys, comprehensive works, Road: Economics
IdentifiersURN: urn:nbn:se:vti:diva-719OAI: oai:DiVA.org:vti-719DiVA: diva2:669419