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Intermodal and Intramodal Competition in Passenger Rail Transport

  • Ivaldi, Marc
  • Vibes, Catherine

The objective of the paper is to elaborate a simulation model to analyse inter and intra-modal competition in the transport industry, based on game theory models. In our setting, consumers choose a transport mode and an operator to travel on a given city-pair; operators strategically decide on prices for the types of service they provide. We derive the market equilibrium and simulate potential scenarios. In particular we measure the impact of entry by a low cost train operator and the effect of a kerosene tax. Hence our framework could serve as a tool to measure the effectiveness of competition on a relevant market or to design marketing strategies. More generally it can be applied in cases of oligopolistic competition when detailed data are not available.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5004.

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Date of creation: Apr 2005
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Handle: RePEc:cpr:ceprdp:5004
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  1. McFadden, Daniel, 1974. "The measurement of urban travel demand," Journal of Public Economics, Elsevier, vol. 3(4), pages 303-328, November.
  2. Ivaldi, Marc & Verboven, Frank, 2005. "Quantifying the effects from horizontal mergers in European competition policy," International Journal of Industrial Organization, Elsevier, vol. 23(9-10), pages 669-691, December.
  3. Tae H. Oum & Waters, W.G. & Jong Say Yong, 1990. "A survey of recent estimates of price elasticities of demand for transport," Policy Research Working Paper Series 359, The World Bank.
  4. Ivaldi, Marc & Pouyet, Jérôme & de Villemeur, Étienne, 2003. "Entry in the Passenger Rail Industry : A Theoretical Investigation," IDEI Working Papers 192, Institut d'Économie Industrielle (IDEI), Toulouse.
  5. Steven T. Berry, 1994. "Estimating Discrete-Choice Models of Product Differentiation," RAND Journal of Economics, The RAND Corporation, vol. 25(2), pages 242-262, Summer.
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