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Should I go by bus? The liberalization of the long-distance bus industry in France

Author

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  • Thierry Blayac

    (LAMETA - Laboratoire Montpelliérain d'Économie Théorique et Appliquée - UM1 - Université Montpellier 1 - UPVM - Université Paul-Valéry - Montpellier 3 - INRA - Institut National de la Recherche Agronomique - Montpellier SupAgro - Centre international d'études supérieures en sciences agronomiques - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)

  • Patrice Bougette

    (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (1965 - 2019) - CNRS - Centre National de la Recherche Scientifique - UniCA - Université Côte d'Azur)

Abstract

The opening up of the French long-distance bus industry is one of the outcomes of the Loi Macron. In this study, we build a unique data set of several representative bus routes and show that the effects of the liberalization have been encouraging in terms of fares, new entry, higher frequency, and higher quality. First, with regard to international routes that used to be under cabotage, we find that relaxing quantitative restrictions has led to the expected results on the Lyon–Torino and Paris–London routes. Second, with regard to domestic routes newly created from the Loi Macron, mostly all procompetitive expected variations in the variables have been observed, except for fares. Indeed, we show that bus operators used an initial aggressive pricing strategy to induce demand for the new services and then increased fares once customers became accustomed with the service.
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Suggested Citation

  • Thierry Blayac & Patrice Bougette, 2017. "Should I go by bus? The liberalization of the long-distance bus industry in France," Post-Print halshs-01637672, HAL.
  • Handle: RePEc:hal:journl:halshs-01637672
    DOI: 10.1016/j.tranpol.2017.03.004
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    Cited by:

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    3. Mizuta, Seiichiro, 2020. "Deregulation and competition in Japanese intercity coach industry," Transportation Research Part A: Policy and Practice, Elsevier, vol. 139(C), pages 17-34.
    4. Avenali, Alessandro & Gregori, Martina & Reverberi, Pierfrancesco, 2023. "Intercity bus and rail services: Competition and welfare effects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 172(C).
    5. Burgdorf, Christian & Eisenkopf, Alexander, 2018. "Effects of road tolls for intercity buses on travel activities and the choice of means of transport in German long-distance passenger transport," Research in Transportation Economics, Elsevier, vol. 72(C), pages 92-105.
    6. Gaggero, Alberto A. & Ogrzewalla, Lukas & Bubalo, Branko, 2019. "Pricing of the long-distance bus service in Europe: The case of Flixbus," Economics of Transportation, Elsevier, vol. 19(C), pages 1-1.
    7. Beria, Paolo & Bertolin, Alberto, 2019. "Evolving long-distance passenger services. Market concentration, fares and specialisation patterns in Italy," Research in Transportation Economics, Elsevier, vol. 74(C), pages 77-92.
    8. Aarhaug, Jørgen & Farstad, Eivind & Fearnley, Nils & Halse, Askill Harkjerr, 2018. "Express coaches: An up-hill battle after liberalization?," Research in Transportation Economics, Elsevier, vol. 72(C), pages 82-91.
    9. Dürr, Niklas S. & Hüschelrath, Kai, 2017. "Patterns of entry and exit in the deregulated German interurban bus industry," Transport Policy, Elsevier, vol. 59(C), pages 196-208.
    10. Fageda, Xavier & Sansano, Sergi, 2018. "Factors influencing prices and frequencies in the interurban bus market: Evidence from Europe," Transportation Research Part A: Policy and Practice, Elsevier, vol. 111(C), pages 266-276.
    11. Beria, Paolo & Nistri, Dario & Laurino, Antonio, 2018. "Intercity coach liberalisation in Italy: Fares determinants in an evolving market," Research in Transportation Economics, Elsevier, vol. 69(C), pages 260-269.

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    More about this item

    JEL classification:

    • L43 - Industrial Organization - - Antitrust Issues and Policies - - - Legal Monopolies and Regulation or Deregulation
    • L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

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