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Do maritime passengers’ subsidies in Europe affect prices?

Juan Jiménez González, Jorge Valido and Naykel Morán

Maritime Policy & Management, 2018, vol. 45, issue 7, 911-923

Abstract: Some European governments subsidize their residents when they travel at sea. This paper seeks to analyze the impact on prices of maritime passengers’ subsidies in Europe. Following a review of the scarce academic literature on this topic and the subsidy scheme in Europe, a sample of firms’ prices and other characteristics of 40 European routes for 2016 are analyzed. Both an estimation of a price equation and a matching approach are applied and reach the same conclusion: prices per kilometer are around 40 per cent higher on those subsidized routes due to subsidies. This outcome reduces the potential subsidy gain to consumers.

Date: 2018
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DOI: 10.1080/03088839.2018.1441558

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