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Bus Competition in Ireland: Delayed by Regulatory Roadblocks

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  • Patrick Massey

Abstract

Competition in local bus services in Ireland has been prohibited for more than 80 years, with the majority of services operated by state-owned monopolies. The Public Transport Regulation Act 2009 seemed to herald a radical departure. It established a new transport regulator and provided that, after an initial five-year period, routes would be opened up to competitive tendering unless an extension of the incumbents' monopoly rights was necessary to guarantee continuity of services. Yet in December 2013 the regulator decided to extend the state bus companies' monopolies on the vast majority of their routes until the end of 2019. This paper argues that there is no economic evidence to support this decision, which is reminiscent of the previous policy approach of protecting the state companies and raises concerns of possible regulatory capture. The paper calls for the phased introduction of competitive tendering of all routes currently operated by the state bus companies as quickly as possible.

Suggested Citation

  • Patrick Massey, 2014. "Bus Competition in Ireland: Delayed by Regulatory Roadblocks," Economic Affairs, Wiley Blackwell, vol. 34(3), pages 319-334, October.
  • Handle: RePEc:bla:ecaffa:v:34:y:2014:i:3:p:319-334
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    File URL: http://hdl.handle.net/10.1111/ecaf.12090
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    1. Massey, Patrick, 2007. "Delayed Indefinitely: Regulatory Reform of the Irish Bus Industry," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI), vol. 2007(1-Spring), pages 38-61.
    2. Casey, J. Jerome, 2005. "Improving Irish Bus Markets: But not by Competition Alone," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI), vol. 2005(2-Summer), pages 1-15.
    3. Barrett, Sean D., 2004. "Bus Competition in Ireland - The Case for Market Forces," Quarterly Economic Commentary: Special Articles, Economic and Social Research Institute (ESRI), vol. 2004(3-Autumn), pages 1-20.
    4. David A. Hensher & Ian P. Wallis, 2005. "Competitive Tendering as a Contracting Mechanism for Subsidising Transport: The Bus Experience," Journal of Transport Economics and Policy, University of Bath, vol. 39(3), pages 295-322, September.
    5. Sean D. Barrett, 2011. "An Economic Analysis of the Public Transport Regulation Act, 2009," The Economic and Social Review, Economic and Social Studies, vol. 42(1), pages 49-70.
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