EconPapers    
Economics at your fingertips  
 

Competition in multi-modal transport networks: A dynamic approach

Adriaan van der Weijde, Erik Verhoef () and Vincent van den Berg

Transportation Research Part B: Methodological, 2013, vol. 53, issue C, 31-44

Abstract: We analyze the behavior of market participants in a multi-modal commuter network, where roads are not priced, but public transport has a usage fee, which is set while taking the effects on the roads into account. In particular, we analyze the difference between markets with a monopolistic public transport operator, which operates all public transport links, and markets in which separate operators own each public transport link. To do so, we consider a simple dynamic transport network consisting of two serial segments and two parallel congestible modes of transport. We obtain a reduced form of the public transport operator’s optimal fare setting problem and show that, even if the total travel demand is inelastic, serial Bertrand–Nash competition on the public transport links leads to different fares than a serial monopoly; a result not observed in a static model. This results from the fact that trip timing decisions, and therefore the generalized prices of all commuters, are influenced by all fares in the network. We then use numerical simulations to show that, contrary to the results obtained in classic studies on vertical competition, monopolistic fares are not always lower than duopolistic fares; the opposite can also occur. We also explore how different parameters influence the price differential, and how this affects welfare.

Keywords: Public transport; Congestion; Competition; Market design (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S019126151300043X
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Competition in Multi-Modal Transport Networks: A Dynamic Approach (2012) 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:transb:v:53:y:2013:i:c:p:31-44

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_1&version=01

Access Statistics for this article

Transportation Research Part B: Methodological is currently edited by Fred Mannering

More articles in Transportation Research Part B: Methodological from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-04-12
Handle: RePEc:eee:transb:v:53:y:2013:i:c:p:31-44