EconPapers    
Economics at your fingertips  
 

Can privatization of U.S. highways improve motorists' welfare?

Clifford Winston () and Jia Yan ()

Journal of Public Economics, 2011, vol. 95, issue 7, 993-1005

Abstract: We assess the welfare effects of highway privatization accounting for government's behavior in setting the sale price, firms' strategic behavior in setting tolls, and motorists' heterogeneous preferences for speedy and reliable travel. We find motorists are able to benefit from privatization by negotiating tolls with private providers that increase their consumer surplus. Surprisingly, we find that by obtaining tolls and service that align with their varying preferences, motorists may be better off negotiating with a monopolist than with duopoly providers or under public–private competition. Toll regulation may be counterproductive because it is likely to treat motorists as homogeneous.

Keywords: Highway privatization; Preference heterogeneity; Mixed logit (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0047272711000090
Full text for ScienceDirect subscribers only

Related works:
Journal Article: Can privatization of U.S. highways improve motorists' welfare? (2011) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:95:y:2011:i:7:p:993-1005

Access Statistics for this article

Journal of Public Economics is currently edited by R. Boadway and J. Poterba

More articles in Journal of Public Economics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-10-17
Handle: RePEc:eee:pubeco:v:95:y:2011:i:7:p:993-1005