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Government Failure in Urban Transportation

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  • Clifford Winston

Abstract

This paper assesses governmental performance in its investment, provision and regulation of urban transportation. Attention is given to public bus and rail transit and road transportation. Evidence based on urban transport in US cities reveals substantial allocative and technical inefficiencies that have led to large public transit deficits and severe highway congestion. I argue that it is futile to expect public officials to remedy the situation by pursuing more efficient policies such as congestion pricing and weighing costs and benefits when deciding transit service. The problem is that urban transportation policy is largely shaped by entrenched political forces that inhibit constructive change. The only realistic way to improve the system is to shield it from those influences and expose it to market forces by privatising it. This position is supported by empirical evidence based on simulations for the US and the UK’s early experience with privatisation.

Suggested Citation

  • Clifford Winston, 2000. "Government Failure in Urban Transportation," Fiscal Studies, Institute for Fiscal Studies, vol. 21(4), pages 403-425, December.
  • Handle: RePEc:ifs:fistud:v:21:y:2000:i:4:p:403-425
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    File URL: http://www.ifs.org.uk/fs/articles/0030a.pdf
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    References listed on IDEAS

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    1. Lave, Charles, 1991. "Measuring the Decline in Transit Productivity in the U.S," University of California Transportation Center, Working Papers qt63g5j4z4, University of California Transportation Center.
    2. Sam Peltzman, 1992. "Voters as Fiscal Conservatives," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 327-361.
    3. Walters, A. A., 1982. "Externalities in urban buses," Journal of Urban Economics, Elsevier, vol. 11(1), pages 60-72, January.
    4. David M. Newbery & Georgina Santos, 1999. "Road taxes, road user charges and earmarking," Fiscal Studies, Institute for Fiscal Studies, pages 103-132.
    5. Calfee, John & Winston, Clifford, 1998. "The value of automobile travel time: implications for congestion policy," Journal of Public Economics, Elsevier, vol. 69(1), pages 83-102, July.
    6. Clifford Winston, 1998. "U.S. Industry Adjustment to Economic Deregulation," Journal of Economic Perspectives, American Economic Association, vol. 12(3), pages 89-110, Summer.
    7. Karlaftis, Matthew & McCarthy, Patrick, 1999. "The Effect of Privatization on Public Transit Costs," Journal of Regulatory Economics, Springer, vol. 16(1), pages 27-43, July.
    8. Pashigian, B Peter, 1976. "Consequences and Causes of Public Ownership of Urban Transit Facilities," Journal of Political Economy, University of Chicago Press, vol. 84(6), pages 1239-1259, December.
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    Citations

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    Cited by:

    1. Yoshitaka Fukui & Kyoji Oda, 2012. "Discussion Paper: Who Should Take Responsibility for Unexpected Interest Changes? Lesson from the Privatization of Japanese Railroad System," Networks and Spatial Economics, Springer, vol. 12(2), pages 263-278, June.
    2. Feng Xie & David Levinson, 2009. "Governance choice on a serial network," Public Choice, Springer, vol. 141(1), pages 189-212, October.
    3. repec:eee:pubeco:v:154:y:2017:i:c:p:95-121 is not listed on IDEAS
    4. Fernando Lambarry Vilchis & Luis Arturo Rivas Tovar & Mara Maricela Trujillo Flores, 2010. "Institutional Aspects on Bus Rapid Transit Systems Implementation in Mexico City, Estado de Mexico and Le¨®n Guanajuato," Journal of Management and Strategy, Journal of Management and Strategy, Sciedu Press, vol. 1(1), pages 93-109, December.
    5. Idris, Ahmed Osman & Nurul Habib, Khandker M. & Shalaby, Amer, 2015. "An investigation on the performances of mode shift models in transit ridership forecasting," Transportation Research Part A: Policy and Practice, Elsevier, vol. 78(C), pages 551-565.
    6. Peter Gordon, 2012. "Spontaneous Cities," Working Paper 8954, USC Lusk Center for Real Estate.
    7. Eduardo Engel & Ronald Fischer & Alexander Galetovic, 2006. "Privatizing Highways in the United States," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 29(1), pages 27-53, September.
    8. Rhiannon Jerch & Matthew E. Kahn & Shanjun Li, 2016. "Efficient Local Government Service Provision: The Role of Privatization and Public Sector Unions," NBER Working Papers 22088, National Bureau of Economic Research, Inc.
    9. Clifford Winston & Jia Yan, 2008. "US Highway Privatization and Heterogeneous Preferences," Working Papers 2008-20, School of Economic Sciences, Washington State University.
    10. Shirley, Chad & Winston, Clifford, 2004. "Firm inventory behavior and the returns from highway infrastructure investments," Journal of Urban Economics, Elsevier, vol. 55(2), pages 398-415, March.
    11. Yunqiang Xue & Hongzhi Guan & Jonathan Corey & Heng Wei & Hai Yan, 2017. "Quantifying a Financially Sustainable Strategy of Public Transport: Private Capital Investment Considering Passenger Value," Sustainability, MDPI, Open Access Journal, vol. 9(2), pages 1-20, February.
    12. Cascetta, Ennio & Cartenì, Armando & Pagliara, Francesca & Montanino, Marcello, 2015. "A new look at planning and designing transportation systems: A decision-making model based on cognitive rationality, stakeholder engagement and quantitative methods," Transport Policy, Elsevier, vol. 38(C), pages 27-39.

    More about this item

    JEL classification:

    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics

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