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Entry in liberalized railway markets: The German experience

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Author Info

  • Rafael Lalive

    ()
    (HEC Lausanne, University of Lausanne)

  • Armin Schmutzler

    ()
    (Socioeconomic Institute, University of Zurich)

Abstract

In Germany, competitive franchising is increasingly being used to procure passenger railway services that were previously provided by a state monopolist. This paper analyzes the 77 tenders that have taken place since the railway reform in 1994. The tenders differ with respect to the size of the franchise network, the required frequency of service, the duration of the contract and the proximity to other lines that are already run by competitors of DB Regio, a subsidiary of the successor of the former state monopolist. Our analysis shows that larger networks are less likely to be won by the competitors. Also, more recent auctions have been won by competitors more frequently than earlier auctions. Other control variables such as the duration of the contract and the adjacency to other lines run by entrants are insignificant.

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File URL: http://www.soi.uzh.ch/research/wp/2006/wp0609.pdf
File Function: revised version, 2007
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Bibliographic Info

Paper provided by Socioeconomic Institute - University of Zurich in its series SOI - Working Papers with number 0609.

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Length: 20 pages
Date of creation: Nov 2006
Date of revision: Apr 2007
Publication status: published in Review of Network Economics, 7(1), pp. 37-52, 2008
Handle: RePEc:soz:wpaper:0609

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Keywords: Competition for the market; liberalization; passenger railways; procurement auctions;

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References

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  1. Lalive, Rafael & Schmutzler, Armin, 2005. "Competition for Railway Markets: The Case of Baden-Württemberg," CEPR Discussion Papers 5396, C.E.P.R. Discussion Papers.
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Citations

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Cited by:
  1. Daniel Halbheer & Ernst Fehr & Lorenz Goette & Armin Schmutzler, 2007. "Self-Reinforcing Market Dominance," SOI - Working Papers 0711, Socioeconomic Institute - University of Zurich.
  2. Adrian Bruhin, 2008. "Stochastic Expected Utility and Prospect Theory in a Horse Race: A Finite Mixture Approach," SOI - Working Papers 0803, Socioeconomic Institute - University of Zurich.
  3. Ilja Neustadt & Peter Zweifel, 2009. "Economic Well-Being, Social Mobility, and Preferences for Income Redistribution: Evidence from a Discrete Choice Experiment," SOI - Working Papers 0909, Socioeconomic Institute - University of Zurich, revised Jan 2010.
  4. Dario Sacco & Armin Schmutzler, 2008. "Competition and Innovation: An Experimental Investigation," SOI - Working Papers 0807, Socioeconomic Institute - University of Zurich.
  5. Dennis Gaertner, 2007. "Monopolistic Screening under Learning By Doing," SOI - Working Papers 0718, Socioeconomic Institute - University of Zurich.
  6. Rafael Lalive & Armin Schmutzler, 2005. "Exploring the Effects of Competition for Railway Markets," SOI - Working Papers 0511, Socioeconomic Institute - University of Zurich, revised Apr 2007.
  7. Dario Sacco & Armin Schmutzler, 2008. "All-Pay Auctions with Negative Prize Externalities: Theory and Experimental Evidence," SOI - Working Papers 0806, Socioeconomic Institute - University of Zurich.
  8. Josef Falkinger, 2008. "Between Agora and Shopping Mall," SOI - Working Papers 0805, Socioeconomic Institute - University of Zurich.
  9. Helga Fehr-Duda & Adrian Bruhin & Thomas Epper & Renate Schubert, 2007. "Rationality on the Rise: Why Relative Risk Aversion Increases with Stake Size," SOI - Working Papers 0708, Socioeconomic Institute - University of Zurich, revised Feb 2008.
  10. Sandra Hanslin, 2008. "The effect of trade openness on optimal government size under endogenous firm entry," SOI - Working Papers 0802, Socioeconomic Institute - University of Zurich.
  11. Augustin, Katrin & Walter, Matthias, 2010. "Operator changes through competitive tendering: Empirical evidence from German local bus transport," Research in Transportation Economics, Elsevier, vol. 29(1), pages 36-44.
  12. Johannes Schoder & Peter Zweifel, 2008. "Managed Care Konzepte und Lösungsansätze– Ein internationaler Vergleich aus schweizerischer Sicht," SOI - Working Papers 0801, Socioeconomic Institute - University of Zurich.
  13. Lalive, Rafael & Luechinger, Simon & Schmutzler, Armin, 2013. "Does Supporting Passenger Railways Reduce Road Traffic Externalities?," CEPR Discussion Papers 9335, C.E.P.R. Discussion Papers.
  14. Dennis Gaertner, 2007. "Why Bayes Rules: A Note on Bayesian vs. Classical Inference in Regime Switching Models," SOI - Working Papers 0719, Socioeconomic Institute - University of Zurich.
  15. Lukas Steinmann & Harry Telser & Peter Zweifel, 2005. "The Impact of Aging on Future Healthcare Expenditure," SOI - Working Papers 0510, Socioeconomic Institute - University of Zurich, revised Dec 2006.
  16. Stefan Boes, 2007. "Nonparametric Analysis of Treatment Effects in Ordered Response Models," SOI - Working Papers 0709, Socioeconomic Institute - University of Zurich.

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