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An econometric analysis of motorway renewal costs in Germany

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Author Info
Heike Link () (German Institute for Economic Research, Berlin)

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Abstract

This paper analyses the cost bahaviour of motorway renewal costs with the aim to derive an estimate of marginal infrastructure costs per vehicle-km of trucks as part of optimal road user charges. The analysis is based on cross-sectional data of motorway renewal costs and traffic volume per motorway section in Germany during the period 1980-1999. The translog model estimated in this paper includes the factor input prices for labour, material and capital, the average annual daily traffic volume of trucks and passenger cars with the respective second-order terms. and a set of dummy variables for regions (the German länder) as well as for the type of material used for renewal as the most explanatory variables. In contrast to this, we could not find any significant influence of the age of motorway sections, the past renewal expenditures and the climate conditions measured as days with temperature fluctuations around zero. The cost elasticity, i.e. the relationship between marginal and average costs found in this analysis ranges from 0.05 up to 1.17 with a digressive increase of marginal costs.

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File URL: http://www.wiwi.uni-muenster.de/ivm/materialien/forschen/veroeffentlichungen/diskussionspapier9.pdf
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File Function: First version, 2004
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Publisher Info
Paper provided by Institute of Transport Economics, University of Muenster in its series Working Papers with number 09.

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Length: 20 pages
Date of creation: Jul 2004
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Handle: RePEc:mut:wpaper:09

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Related research
Keywords: Cost functions; motorway renewal costs; marginal costs; infrastructure charging; road transport;

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Find related papers by JEL classification:
R48 - Urban, Rural, and Regional Economics - - Transportation Systems - - - Government Pricing; Regulatory Policies
L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
C31 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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  1. Luigi Benfratello & Alberto Iozzi & Paola Valbonesi, 2009. "Technology and incentive regulation in the Italian motorways industry," Journal of Regulatory Economics, Springer, vol. 35(2), pages 201-221, April. [Downloadable!] (restricted)
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