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on Transport Economics |
| By: | Kilani, Moez; Proost, Stef; van der Loo, Saskia |
| Abstract: | This paper explores reforms of pricing of private and public transport in Paris. Paris has used a policy of very low public transport prices and no road pricing. The Paris transport network is represented as a stylized concentric city with the choice between car, rapid rail, metro and busses as well as two income classes and different transport motives. The model is used to test what are the efficiency gains of introducing road pricing and of increasing public transit prices in the peak. Are both reforms re-enforcing each other or are they largely substitutes? We find that a zonal pricing scheme for the center of Paris combined with higher public transport fares in the peak perform best. The benefits of an overall capacity extension of public transport supply are much lower than the benefits of pricing reforms and could very well not pass the cost benefit test. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/418969&r=tre |
| By: | Andre DE PALMA; Fay DUNKERLEY; Stefan PROOST |
| Abstract: | Many transport and other service problems come down to simple network choices: what mode and/ or route to take, if some of the routes and modes are congested and their use can be priced or not priced by different operators. The operators can have different objective functions: public or private monopoly, private duopoly, etc.. This standard problem has been studied in many variants, mostly using the assumption of perfect substitutability between alternatives, so that in the deterministic Wardrop equilibrium, all routes that are used have the same generalized cost. This paper examines in more detail the role of the perfect substitutability assumption. Users of a network consume transport services, which are differentiated in two ways. There are objective differences in quality (length of route, congestion level) perceived by all users and there are individual idiosyncratic preferences for transport services. The resulting stochastic equilibrium is analysed on a simple parallel network for four types of ownership regimes: private ownership, coordinated public ownership, mixed public-private and public Stackelberg leadership. We find that, firstly, when total demand is fixed and there is congestion, then by controlling one route a government can achieve the First Best allocation, although the second route is privately operated or unpriced. This result holds whatever the level of substitutability and whatever the levels of congestion. Secondly, whenever imperfect substitutability is present, private supply of one of the two routes becomes relatively less efficient because the private supplier has an additional source of market power to exploit. If the better of the two routes is privately supplied it is always insufficiently used. However, if only one route can be privately operated, then this should always be the intrinsically better route. |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:ete:ceswps:ces13.21&r=tre |
| By: | de Palma, André; Kilani, Moez; Proost, Stef |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/379576&r=tre |
| By: | De Borger, Bruno; Proost, Stef |
| Abstract: | This paper studies the political economy of pricing and investment for excludable and congestible public goods in a federal state. Currently, we observe a wide variety of practices, ranging from federal gasoline taxes and road investment to the local supply of -- and sometimes free access to -- libraries, parking spaces and public swimming pools. The two-region model we develop allows for spill-overs between regions, it takes into account congestion, and it captures both heterogeneity between and within regions. Regional decisions are taken by majority voting; decisions at the federal level are taken either according to the principle of a minimum winning coalition or through cooperative bargaining. We have the following results. First, when users form the majority in at least one region, decentralized decision making performs certainly better than centralized decision making if spill-overs are not too large. Centralized decisions may yield higher welfare than decentralization only if users have a large majority and the infrastructure in a given region is intensively used by both local and outside users. Second, if non-users form a majority in both regions, centralized and decentralized decision making yield the same socially undesirable outcome, with prices that are much too high. Third, both bargaining and imposing uniform price restrictions across regions improve the performance of centralized decisions. Fourth, the performance of decentralized supply is strongly enhanced by local self-financing rules; it prevents potential exploitation of users within regions. Self-financing rules at the central level are not necessarily welfare-improving. Finally, the results of this paper contribute to a better understanding of actual policy-making. |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/416349&r=tre |
| By: | John Eakins (School of Economics, University College Cork and Surrey Energy Economics Centre (SEEC), School of Economics, University of Surrey.) |
| Abstract: | This paper analyses the factors which influence the level of possession of cars in Irish households using four rounds of the Household Budget Survey, a large micro cross sectional data set of Irish households. Two qualitative choice models, the multinomial logit model and the ordered logit model are applied and their results compared. Based on various measures of fit, the multinomial logit model appears to be the preferred model. The main factors found to influence car possession include location, age, education and marital status of the head of household, use of public transport, the number of workers, number of non-workers and number of children in the household and total household expenditure. These factors are also consistently observed to influence car ownership over time although the effect of socioeconomic factors such as education and marital status appears to be diminishing. The number of workers in the household and total household expenditure are key determinants and mirror changes experienced at the macro level. The estimated income elasticities for these variables show that the number of workers in the household determines the decision to purchase more than one car to a greater extent than total household expenditure and total household expenditure determines the decision to purchase one car to a greater extent than the number of workers in the household. |
| Keywords: | OECD-Europe Motor Vehicle ownership; Household Survey Data; Multinomial Logit Model; Ordered Logit Model; Income Elasticities. |
| JEL: | R41 C35 D12 |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:sur:seedps:144&r=tre |
| By: | Evers, Ruth; Proost, Stef |
| Abstract: | In this paper we optimize the regulation of an intersection of two routes connecting one origin-destination pair and study the effects of priority rules, traffic lights and tolls. We show that when the intersection is regulated by a priority rule the optimal policy is generally to block one of the two routes. When the intersection is regulated by traffic lights, it can only be optimal to leave both routes open when both routes are subject to congestion or if a toll is levied. |
| Date: | 2013–10 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/418183&r=tre |
| By: | De Palma, André; Proost, Stef; Van der Loo, Saskia |
| Abstract: | We use a simple economy with two interconnected geographical zones. Individuals can live and work in one of the two zones or can commute between them. This model is used to explore the dynamics of housing and work decisions after a permanent shock in labour demand occurred in one of the two zones. We illustrate the role of the different levels of expectation of developers and government transport agencies for the equilibrium on the housing and the labour markets. The model is used to identify better Cost-Benefit rules for transport investments and the role of coordination between housing and transport decisions. |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/410262&r=tre |
| By: | Lewis, Justin |
| Abstract: | This paper analyzes how The Jones Act, a maritime law that effectively closes the United States’ coastal shipping routes to foreign firms, impacts the economic welfare of domestic ocean transport consumers. Though it has long been speculated that the Act is economically detrimental to the United States, and some efforts to examine this have been made in the past, the data needed to facilitate precise estimates was not available until very recently. Using an original framework, I apply this new data in generating a better understanding of how the Jones Act’s trade restrictions translate into economic consequences. Section 1 frames the Act within its broader political-economic context and describes the motivation behind my question along with my approach to answering it. Section 2 describes the maritime shipping industry and the Jones Act’s place within it, while Section 3 addresses related findings from past research and how they impel this study. Section 4 details my methodology (along with corresponding economic intuition) and presents the thesis’ finding: that consumers of the domestic maritime transport would be significantly better off (on the order of more than $578 million/year, in monetary terms) if the Jones Act’s restrictions were not in place. Section 5 discusses the potential implications of this result for other sectors of the economy as well as for the direction of future public policy. |
| Keywords: | Maritime Economics, Jones Act, Cabotage, Transport Regulation |
| JEL: | K23 L9 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:51469&r=tre |
| By: | Crabbe, Marjolein; Akinc, Deniz; Vandebroek, Martina |
| Abstract: | The mixed logit choice model has become the common standard to analyze transport behavior. Efficient design of the corresponding choice experiments is therefore indispensable to obtain precise knowledge of travelers’ preferences. Accounting for the individual-specific coefficients in the model, this research advocates an individualized design approach. Individualized designs are sequentially generated for each person separately, using the answers from previous choice sets to select the next best set in a survey. In this way they are adapted to the specific preferences of an individual and therefore more efficient than an aggregate design approach. In order for individual sequential designs to be practicable, the speed of designing an additional choice set in an experiment is obviously a key issue. This paper introduces three design criteria used in optimal test design, based on Kullback-Leibler information, and compares them with the well-known D-efficiency criterion to obtain individually adapted choice designs for the mixed logit choice model. Being equally efficient to D-efficiency and at the same time much faster, the Kullback-Leibler criteria are well suited for the design of individualized choice experiments. |
| Keywords: | Discrete choice; Mixed logit; Individualized design; D-efficiency; Kullback-Leibler information; |
| Date: | 2013–02 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/390699&r=tre |
| By: | Stephen P. Holland; Jonathan E. Hughes; Christopher R. Knittel; Nathan C. Parker |
| Abstract: | Renewable fuel standards, low carbon fuel standards, and ethanol subsidies are popular policies to incentivize ethanol production and reduce emissions from transportation. Compared to carbon trading, these policies lead to large shifts in agricultural activity and unexpected social costs. We simulate the 2022 Federal Renewable Fuel Standard (RFS) and find that energy crop production increases by 39 million acres. Land- use costs from erosion and habitat loss are between $277 and $693 million. A low carbon fuel standard (LCFS) and ethanol subsidies have similar effects while costs under an equivalent cap and trade (CAT) system are essentially zero. In addition, the alternatives to CAT magnify errors in assigning emissions rates to fuels and can over or under-incentivize innovation. These results highlight the potential negative efficiency effects of the RFS, LCFS and subsidies, effects that would be less severe under a CAT policy. |
| JEL: | H4 Q2 Q4 Q5 |
| Date: | 2013–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19636&r=tre |
| By: | Singh, Neelam |
| Abstract: | With increasing globalization, the intense competition and customer-pressure have spurred many producers from developing/ emerging countries to adopt the best management and organizational practices. The quality issues are paramount for automotive manufacturing. The multiplicity of Quality Management System (QMS) Standards prevalent till the 1990s finally gave way to development of a harmonized automotive industry-specific QMS, namely ISO/TS-16949. This paper analyzes the major factors motivating firms to adopt this Standard: its quality signaling function, especially in international business, and facilitative role in moving up the supply chain. We investigate the inter-national and inter-regional concentration of ISO/TS-16949 certificates and relate those changes to the automotive industry dynamics. Among the top certifying nations - China, India and Brazil included - these certificates and ‘cars and commercial vehicles’ produced are highly correlated. A moderate-to-high worldwide growth of this certification is probable in near future with its gaining popularity among Tier-2 suppliers and for two/ three-wheeler automotive production. The Indian evidence indicates a sizeable proportion of car and commercial vehicle plants being ISO/TS-16949 certified and a high certification incidence among large and medium-large auto component firms. We suggest the creation of a Centre to encourage and prepare SMEs and provide financial assistance for ISO/TS-16949 certification. |
| Keywords: | Quality Management System, QMS; ISO/TS-16949 Standard; automotive industry; international QMS Standard; India |
| JEL: | F23 L15 L62 |
| Date: | 2013–11–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:51342&r=tre |