Evaluating Alternative Policy Responses to Franchise Failure: Evidence from the Passenger Rail Sector in Britain
One potential problem with franchising (competitive tendering) is how to deal with situations where the franchisee is unwilling to continue operating the franchise within the contract period. This paper studies the effects of the franchising authority's response to franchise failure in passenger rail in Britain, which saw the affected operators placed onto management or short-term renegotiated contracts for an extended period. We find that operators on management contracts saw a sharp deterioration in efficiency. Further, the contract inefficiency persisted, though was eliminated by competitive refranchising. In contrast, costs for renegotiated franchises were no higher (statistically) than industry best practice. © 2012 LSE and the University of Bath
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.
When requesting a correction, please mention this item's handle: RePEc:tpe:jtecpo:v:46:y:2012:i:1:p:25-49. 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: (Christopher F. Baum)
If references are entirely missing, you can add them using this form.