Why Competition Does Not Work in Urban Bus Markets: Some New Wheels for Some Old Ideas
AbstractIn this paper a model is presented based on ideas borrowed from the job search and price dispersion literature to characterise the pricing equilibrium of a competitive bus market in a more general setting than previously found in the literature. The results indicate that collusion is not required to obtain a monopoly price structure. Rather collusion can be interpreted as a coordination device among operators to reach their most preferred equilibrium. The results rationalise some of the stylised facts observed in liberalisation experiences around the world, including rising prices, excessive entry, convergence of fares among operators, and other observed behaviour. © 2007 LSE and the University of Bath
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.
Bibliographic InfoArticle provided by London School of Economics and University of Bath in its journal Journal of Transport Economics and Policy.
Volume (Year): 41 (2007)
Issue (Month): 2 (May)
Contact details of provider:
Web page: http://www.bath.ac.uk/e-journals/jtep
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Bataille, Marc & Steinmetz, Alexander, 2013. "Intermodal competition on some routes in transportation networks: The case of inter urban buses and railways," DICE Discussion Papers 84, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christopher F. Baum).
If references are entirely missing, you can add them using this form.