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Estimating the marginal maintenance cost of rail infrastructure usage in Sweden; does more data make a difference?

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Abstract

This paper updates knowledge about the marginal cost of railway maintenance. Using a panel dataset comprising 16 years, we test whether more data makes a difference to conclusions. In contrast to previous estimates using a shorter panel, maintenance costs are now demonstrated to exhibit a positive dynamic effect; an increase in maintenance cost during one year indicates the need for more maintenance also the next year. Moreover, the marginal cost from the dynamic model is larger than its static counterpart. We conclude that the use of dynamic models on longer time series may have charging implications in several EU member states, considering that their track access charges are based on econometric studies that use static models and short panel datasets.

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  • Odolinski, Kristofer & Nilsson, Jan-Eric, 2016. "Estimating the marginal maintenance cost of rail infrastructure usage in Sweden; does more data make a difference?," Working papers in Transport Economics 2016:27, CTS - Centre for Transport Studies Stockholm (KTH and VTI), revised 13 May 2017.
    • Handle: RePEc:hhs:ctswps:2016_027
    DOI: 10.1016/j.ecotra.2017.05.001
    Note: Published in Economics of Transportation, Volume 10, June 2017, Pages 8-17.
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    1. Odolinski, Kristofer & Boysen, Hans E., 2018. "Railway line capacity utilisation and its impact on maintenance costs," Working papers in Transport Economics 2018:10, CTS - Centre for Transport Studies Stockholm (KTH and VTI), revised 30 Oct 2018.
    2. Nilsson, Jan-Eric & Odolinski, Kristofer, 2020. "When should infrastructure assets be renewed?: the economic impact of cumulative tonnes on railway infrastructure," Papers 2020:4, Research Programme in Transport Economics.
    3. Marco Henseler, 2021. "A Theoretical Approach to Welfare-Optimal Calculation of Direct Costs in European Rail Regulation," Journal of Public Administration and Governance, Macrothink Institute, vol. 11(1), pages 273284-2732, December.
    4. Nilsson , Jan-Eric Nilsson & Isacsson , Gunnar & Haraldsson, Mattias & Nerhagen, Lena & Odolinski, Kristofer & Swärdh, Jan-Erik & Vierth, Inge & Yarmukhamedov, Sherzod & Österström, Johannes, 2018. "The efficient use of infrastructure – is Sweden pricing traffic on its roads, railways, waters and airways at marginal costs?," Working papers in Transport Economics 2018:2, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    5. Odolinski, Kristofer & Nilsson, Jan-Eric & Yarmukhamedov, Sherzod & Haraldsson, Mattias, 2020. "The marginal cost of track renewals in the Swedish railway network: Using data to compare methods," Economics of Transportation, Elsevier, vol. 22(C).
    6. Odolinski, Kristofer & Wheat, Phill, 2018. "Dynamics in rail infrastructure provision: Maintenance and renewal costs in Sweden," Economics of Transportation, Elsevier, vol. 14(C), pages 21-30.

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    More about this item

    Keywords

    Marginal cost; Rail infrastructure; Maintenance; Dynamic model; Track access charges;
    All these keywords.

    JEL classification:

    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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