Intermodal competition in the London–Paris passenger market: High-Speed Rail and air transport
This paper studies inter- and intramodal competition in the London–Paris passenger market during the period 2003–2009. We identify the degree to and conditions under which High-Speed Rail is a viable substitute for airline travel. Using pooled cross-sectional data we estimate multinomial and mixed logit models to examine actual travel behaviour. Our model allows us to analyse the reaction of passenger behaviour on the withdrawal of aviation alternatives and the completion of the High-Speed Rail link between the two cities in November 2007. The results show that travel time and frequency are the main determinants of travel behaviour. The valuation of total travel times changes over the years following the opening of the High-Speed Rail link. Furthermore, we show that the direct elasticity of market share with respect to frequency for a number of aviation alternatives is above 1, indicating that these alternatives are not able to maximise profits. These alternatives subsequently left the market in our sample period. For the remaining aviation alternatives, except for easyJet, we find elasticities of market share with respect to frequency close to 1. Therefore, we conjecture that competition in this market will decline in the long run.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Jun Ishii & Sunyoung Jun & Kurt Van Dender, 2006.
"Air Travel Choices in Multi-Airport Markets,"
050622, University of California-Irvine, Department of Economics.
- Kenneth Train, 2003. "Discrete Choice Methods with Simulation," Online economics textbooks, SUNY-Oswego, Department of Economics, number emetr2.
- Koppelman, Frank S. & Wen, Chieh-Hua, 2000. "The paired combinatorial logit model: properties, estimation and application," Transportation Research Part B: Methodological, Elsevier, vol. 34(2), pages 75-89, February.
- Pels, Eric & Nijkamp, Peter & Rietveld, Piet, 2003. "Access to and competition between airports: a case study for the San Francisco Bay area," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(1), pages 71-83, January.
- Adler, Nicole & Pels, Eric & Nash, Chris, 2010. "High-speed rail and air transport competition: Game engineering as tool for cost-benefit analysis," Transportation Research Part B: Methodological, Elsevier, vol. 44(7), pages 812-833, August.
- Pels, Eric & Nijkamp, Peter & Rietveld, Piet, 2000. "Airport and Airline Competition for Passengers Departing from a Large Metropolitan Area," Journal of Urban Economics, Elsevier, vol. 48(1), pages 29-45, July.
- Park, Yonghwa & Ha, Hun-Koo, 2006. "Analysis of the impact of high-speed railroad service on air transport demand," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 42(2), pages 95-104, March.
- Basar, Gözen & Bhat, Chandra, 2004. "A parameterized consideration set model for airport choice: an application to the San Francisco Bay Area," Transportation Research Part B: Methodological, Elsevier, vol. 38(10), pages 889-904, December.
- Bhat, Chandra R., 1997. "Covariance heterogeneity in nested logit models: Econometric structure and application to intercity travel," Transportation Research Part B: Methodological, Elsevier, vol. 31(1), pages 11-21, February.
- OrtÃºzar, Juan de Dios & Simonetti, Carolina, 2008. "Modelling the demand for medium distance air travel with the mixed data estimation method," Journal of Air Transport Management, Elsevier, vol. 14(6), pages 297-303.
When requesting a correction, please mention this item's handle: RePEc:eee:juecon:v:71:y:2012:i:3:p:278-288. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.