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Public transport authorities’ use of cost-benefit analysis in practice

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Abstract

Public transport services in Sweden are in 2016 worth over 40,000 million SEK annually, and the planning is carried out mostly by the Public Transport Authorities (PTA). Given the national goals for transport and infrastructure, economic efficiency is essential also in public transport operations. In 2003, Ljungberg (2007) sought to answer to which extent PTAs use Cost-Benefit Analyses (CBA), a methodology to assess economic efficiency, in their planning of operations and infrastructure. It was found that CBA is seldom used. This paper tries to answer the same question, but for the year 2016. The aim is, like Ljungberg (2007), to see to what extent PTAs are using CBA today, but also to investigate whether there have been any changes compared to the previous study. A survey was sent to all Swedish PTAs with questions regarding current, previous, and projected future use of CBA. Questions about knowledge of reference materials and why the organization use (or do not use) CBA was asked. The main results are that most PTAs are not using CBA as decision support. For those who does, the method is used mostly for investments in payment systems and major line or traffic changes. When comparing the usage of CBA across different investment categories, the only statistically significant change from the 2003-study is an increased usage when changing fare structure. The PTAs seem not regard a lack of economic resources a reason for not using CBA. Rather, lack of knowledge and more reliance on other types of decision support are the reasons.

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  • Vigren , Andreas & Ljungberg , Anders, 2017. "Public transport authorities’ use of cost-benefit analysis in practice," Working papers in Transport Economics 2017:8, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    • Handle: RePEc:hhs:ctswps:2017_008
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    Cited by:

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    2. Vigren, Andreas & Ljungberg, Anders, 2018. "Public Transport Authorities’ use of Cost-Benefit Analysis in practice," Research in Transportation Economics, Elsevier, vol. 69(C), pages 560-567.
    3. Bondemark, Anders & Sundbergh, Pia & Tornberg, Patrik & Brundell-Freij, Karin, 2020. "Do impact assessments influence transport plans? The case of Sweden," Transportation Research Part A: Policy and Practice, Elsevier, vol. 134(C), pages 52-64.
    4. Trichês Lucchesi, Shanna & Larranaga, Ana Margarita & Bettella Cybis, Helena Beatriz & Abreu e Silva, João António de & Arellana, Julian Alberto, 2021. "Are people willing to pay more to live in a walking environment? A multigroup analysis of the impact of walkability on real estate values and their moderation effects in two Global South cities," Research in Transportation Economics, Elsevier, vol. 86(C).
    5. Zhu, Jingjing & Xu, Xiangdong & Wang, Zijian, 2023. "Economic evaluation of redundancy design for transportation networks under disruptions: Framework and case study," Transport Policy, Elsevier, vol. 142(C), pages 70-83.
    6. Asplund, Disa & Pyddoke, Roger, 2020. "Optimal fares and frequencies for bus services in a small city," Research in Transportation Economics, Elsevier, vol. 80(C).
    7. Johanna Jussila Hammes, 2021. "The Impact of Career Concerns and Cognitive Dissonance on Bureaucrats’ Use of Benefit-Cost Analysis," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 80(2), pages 409-424, October.
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    10. R. M. Vulfovich, 2018. "Mobility as a Life Quality Domain," Administrative Consulting, Russian Presidential Academy of National Economy and Public Administration. North-West Institute of Management., issue 9.

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    More about this item

    Keywords

    Cost Benefit Analysis; Economic efficiency; Survey; CBA usage; Decision support;
    All these keywords.

    JEL classification:

    • C83 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Survey Methods; Sampling Methods
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General
    • L98 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Government Policy

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