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Implementing Optimal Supply of Public Transport: The Choice between Tendering and Targeted Subsidies
Swedish National Road and Transport Research Institute, Society, environment and transport, Transport economics.ORCID iD: 0000-0002-5814-917X
Swedish National Road and Transport Research Institute, Society, environment and transport, Transport economics.
Swedish National Road and Transport Research Institute, Society, environment and transport, Transport economics.ORCID iD: 0000-0001-7976-5628
2016 (English)In: Journal of Transport Economics and Policy, ISSN 0022-5258, E-ISSN 1754-5951, Vol. 50, no 1, 21-38 p.Article in journal (Refereed) Published
Abstract [en]

This paper compares two approaches for providing public transport: competitive tendering and targeted subsidies. The subsidy option means that commercial operators charge a fare, and are paid by the public sector principal both per passenger and per bus in service. This is the case since quality (the number of buses) would otherwise be sub-optimal. Under full information, the tendering and targeted subsidies would establish the same welfare-maximising outcome, while subsidies typically are more expensive for taxpayers. The case for targeted subsidies is stronger under an asymmetric information framework.

Place, publisher, year, edition, pages
2016. Vol. 50, no 1, 21-38 p.
Keyword [en]
Public transport, Contract, Subsidy, Operator, Supply, Services
National Category
Economics
Research subject
00 Road: General works, surveys, comprehensive works, 02 Road: Economics; 10 Road: Transport, society, policy and planning, 111 Road: Public transport
Identifiers
URN: urn:nbn:se:vti:diva-8298ISI: 000370560500002Scopus ID: 2-s2.0-85032739422OAI: oai:DiVA.org:vti-8298DiVA: diva2:900027
Available from: 2016-02-03 Created: 2016-02-03 Last updated: 2017-11-17Bibliographically approved

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Scopushttp://openurl.ingenta.com/content?genre=article&issn=0022-5258&volume=50&issue=1&spage=21&epage=38

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