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Determinants of entry in the deregulated German interurban bus industry

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Listed:
  • Niklas S Dürr
  • Kai Hüschelrath

Abstract

Two years after the deregulation of the German interurban bus industry in January 2013, two new entrants emerged as industry leaders: MeinFernbus (MFB) and FlixBus (FB). We use a comprehensive route-level data set to investigate the determinants of route entry for both providers. Applying survival models, we find that both companies show an increased probability to enter populous routes with large shares of young inhabitants; however, they both avoid entries into routes with low-quality rail connection as well as cities located farther away from the next motorway. Furthermore, both industry leaders largely refrain from entering small- and medium-sized routes in which the other provider is already operating. In large markets, however, they both show an increased entry probability independent of the presence of the other provider.

Suggested Citation

  • Niklas S Dürr & Kai Hüschelrath, 2018. "Determinants of entry in the deregulated German interurban bus industry," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 27(3), pages 467-488.
    • Handle: RePEc:oup:indcch:v:27:y:2018:i:3:p:467-488.
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    File URL: http://hdl.handle.net/10.1093/icc/dtx041
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    More about this item

    JEL classification:

    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • M20 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - General
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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