The Economics of Railways Restructuring in South Korea
AbstractSouth Korea, like many countries, is engaged in a policy debate concerning possible railways reforms. However, unlike most countries, here the focus of discussion has been the government’s proposal to open high-speed passenger train lines to a second train company that would supply on-track competition to KTX trains. While such a policy may indeed lead to lower fares and greater efficiency, worldwide experience casts doubt on the government’s hope that it would lead to such dramatic increases in ridership that the level of subsidies to the overall rail system could be reduced. We argue that a more promising reform strategy may be to introduce competition into freight rail. Based on the Latin American experience, creating independent, vertically integrated, competing freight railway companies could be expected not only to lower shipper rates and increase efficiency but also to raise considerable revenues from the private sector in franchising fees and new investments.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 44992.
Date of creation: Mar 2013
Date of revision:
railways; restructuring; competition; South Korea;
Find related papers by JEL classification:
- L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
- L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics
- R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-03-16 (All new papers)
- NEP-COM-2013-03-16 (Industrial Competition)
- NEP-REG-2013-03-16 (Regulation)
- NEP-TRE-2013-03-16 (Transport Economics)
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