Optimal transit Prices under Increasing Returns to Scale and a Loss Constraint

Optimal transit Prices under Increasing Returns to Scale and a Loss Constraint

Welfare loss might be reduced by requiring total revenues from all units in an urban transport system to meet a proportion of total costs, instead of applying the constraint to each unit separately. This may need an agency to administer prices and cross-subsidisation. Prices are calculated for the East Bay Area of the San Francisco Bay Area.

Share Content

Facebook
Twitter
LinkedIn

Related Articles

Economies of Scale in Bus transport: I. Some British Municipal Results

This study was prompted by the proposal to merge a number of municipal transport undertakings into Passenger transport Authorities. The authors analyse figures showing various working expenses per bus-mile, and find no evidence of scale economies. They point out, however, that the P.T.A.s will be larger than any undertaking in their sample, and that a different conclusion might conceivably be reached if data were available on costs per passenger-mile. Extension of one-man operation appears to offer greater scope for economies than amalgamation.

View Journal »

Optimal Pricing of Urban Passenger transport: A Simulation Exercise for Belgium

First, a simple theoretical model is developed that determines optimal prices for private and urban transport services in both the peak and off-peak periods of the day, taking into account all relevant private and external costs. Second, the model is implemented to study pricing policies in Belgium, using recent estimates of private and social marginal costs. Several applications are then considered.

View Journal »

Road Casualties in London in Relation to Public transport Policy

Exceptional changes in bus and underground rail fares in London in the early 1980s prompted analyses of the effects of fare levels and petrol prices upon the numbers of road casualties in London. Earlier estimates of the number of extra casualties associated with a period of unusually high fares in the early 1980s are shown to have probably been too high.

View Journal »