Railroad Rates, Profitability, and Welfare Under Deregulation
AbstractEfforts to reform regulation of the railroad industry are supported by a substantial body of economic research which has described and measured the cost of the present regulatory regime. In focusing on the defects of the status quo, economists have neglected to give sufficient attention to analyzing in detail the likely consequences of alternative regulatory policies, including deregulation. This paper draws on available estimates of the structure of rail demand and technology in an attempt to predict the impact of rate flexibility at rail prices, profitability, and economic welfare. The effects of deregulation are simulated under a variety of alternative assumptions concerning the elasticity of demand for rail services, the degree of interrailroad competition, the presence or absence of truck deregulation, and the magnitude of rail cost reduction attainable with enhanced commercial freedom. The principal object of this exercise is to ascertain whether rate deregulation is likely to restore the rail industry to financial viability by generating a cash flow sufficient to maintain adequately and improve the physical plant and to provide high quality rail service. A corollary aim is to determine whether present or potential railroad market power is sufficiently great to generate excessive increase in profits, prices, and associated static dead-weight losses.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by The RAND Corporation in its journal Bell Journal of Economics.
Volume (Year): 12 (1981)
Issue (Month): 1 (Spring)
Contact details of provider:
Web page: http://www.rje.org
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Behrens, Kristian & Gaigné, Carl & Thisse, Jacques-François, 2007.
"Is the Regulation of the Transport Sector Always Detrimental to Consumers?,"
CEPR Discussion Papers
6185, C.E.P.R. Discussion Papers.
- Behrens, Kristian & Carl Gaigne & Jacques-Francois Thisse, 2006. "Is the regulation of the transport sector always detrimental to consumers?," CIRJE F-Series CIRJE-F-455, CIRJE, Faculty of Economics, University of Tokyo.
- Kessides, Ioannis N. & Willig, Robert D., 1995. "Restructuring regulation of the rail industry for the public interest," Policy Research Working Paper Series 1506, The World Bank.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.