Contract Renewal as an Incentive Device. An Application to the French Urban Public Transport Sector

Axel Gautier () and Anne Yvrande-Billon

Review of Economics and Institutions, 2013, vol. 4, issue 1

Abstract: in the French urban public transport industry, operations are often delegated and periodically put out for tender. Thus, operators’ incentives to reduce costs come from both profit maximization during the current contract and from the perspective of contract renewal. We construct a dynamic incentive regulation model that captures these features and we show that both the level of cost-reducing effort and its repartition during the contracting period depend on the contract type (cost-plus, gross cost or net cost contract). We then estimate a cost frontier model for an eight-year panel of French bus companies (664 company-year observations) to test our predictions.

Keywords: incentive regulation; urban public transport; stochastic frontier analysis; competition for contract; contract renewal (search for similar items in EconPapers)
JEL-codes: L33 L51 L92 (search for similar items in EconPapers)
Date: 2013
References: Add references at CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
https://rei.unipg.it/rei/article/view/88
Requires registration. Users must be registered and log in to access full text

Related works:
Working Paper: Contract Renewal as an Incentive Device: An Application to the French Urban Public Transport Sector (2013)
Working Paper: Contract Renewal as an Incentive Device: An Application to the French Urban Public Transport Sector (2013)
Working Paper: Contract renewal as an incentive device. An application to the French urban public transport sector (2008)
Working Paper: Contract Renewal as an Incentive Device. An Application to the French Urban Public Transport Sector (2008)
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:pia:review:v:4:y:2013:i:1:n:2

Access Statistics for this article

Review of Economics and Institutions is currently edited by Carlo Andrea Bollino

More articles in Review of Economics and Institutions from Università di Perugia Contact information at EDIRC.
Bibliographic data for series maintained by Ubaldo Pizzoli ().