Improving urban transport performances by tendering lots: an econometric estimation of natural monopoly frontiers

William Roy () and Yves Croissant
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William Roy: LET - Laboratoire d'économie des transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique

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Abstract: Recently, some cities decided to divide their transport network into several attractive and accessible parts (this procedure is called allotment) in order to reduce urban transit costs. Gains obtained by introducing more competition for the market should be compared with costs associated with cutting the network into several parts, and this question is crucially linked with the measure of returns to scale. In this paper, we estimate a translog cost function on a panel of French urban transit networks. Our main conclusion is that scale economies are exhausted for a production corresponding to a city of about 200,000 inhabitants and that allotment, in terms of scale economies, would reduce costs for the seven biggest cities of our sample.

Keywords: urban public transport industry; panel data; natural monopoly; allotment (search for similar items in EconPapers)
Date: 2008-05-29
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00122887v2
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Published in 25e Journées de Microéconomie Appliquée, May 2008, Saint Denis (La Réunion), France

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00122887

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