IDEAS home Printed from
   My bibliography  Save this paper

Concessions of busways to the private sector : the Sao Paulo metropolitan region experience


  • Rebelo, Jorge M.
  • Benvenuto, Pedro P.


Roughly 16,000 buses serve the 16 million inhabitants of the Sao Paulo Metropolitan Region; 12,000 of them serve the Sao Paulo municipality itself, where 8.5 million people live. Congestion is heavy at peak travel times, and traffic signal timing logic favors the flow of automobiles. Bus operations are also hampered by obsolete ticket collection systems and by poor access for bus passengers, which lengthens boarding and aligthing times. Average bus speed is about 13 kilometers per hour, headways vary greatly, and service is unreliable. But conditions are expected to improve soon as the private sector becomes involved in trunk-line bus corridors. Tender documents for ten bus corridors (one state andnine municipal) have recently been issued, defining rules for private concerns to bid for implementing and operating trunk line services. All costs to implement each service, including improvements in street systems and facilities such as transfer terminals, are to be born by the winning firm. Ten bids have now been awarded and contracts signed. This pioneer project demonstrates that private companies are ready to go deeper into public transport than they have gone before. Where the investment in busway infrastructure is to be repaid in installments to the private company which is awarded the concession, the use of multilateral agency guarantees (such as the recently approved World Bank guarantees) will probably entice private entrepreneurs. Regulatory and controlling power remain in the government hands. The government will control tariffs, preventing undue increases harmful to low-income users, and monitoring the level of service offered against the pre-agreed targets. Supervision must be very objective, however, and users must be actively involved to gauge the quality of service offered by concessionaires. Sao Paulo municipal authorities were more successful in attracting the private sector than the State, because they devoted a considerable effort to the design remuneration formulas for the concessions.

Suggested Citation

  • Rebelo, Jorge M. & Benvenuto, Pedro P., 1995. "Concessions of busways to the private sector : the Sao Paulo metropolitan region experience," Policy Research Working Paper Series 1546, The World Bank.
  • Handle: RePEc:wbk:wbrwps:1546

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Williams,Jeffrey C. & Wright,Brian D., 2005. "Storage and Commodity Markets," Cambridge Books, Cambridge University Press, number 9780521023399, March.
    2. Anderson, Ronald W & Gilbert, Christopher L, 1988. "Commodity Agreements and Commodity Markets: Lessons from Tin," Economic Journal, Royal Economic Society, vol. 98(389), pages 1-15, March.
    3. Angus Deaton & Guy Laroque, 1992. "On the Behaviour of Commodity Prices," Review of Economic Studies, Oxford University Press, vol. 59(1), pages 1-23.
    4. Margaret E. Slade, 1991. "Market Structure, Marketing Method, and Price Instability," The Quarterly Journal of Economics, Oxford University Press, vol. 106(4), pages 1309-1340.
    5. Haskel, Jonathan, 1995. "Cartels, Contracts and Centralization: The Transition to Futures Trading for Primary Commodities," CEPR Discussion Papers 1193, C.E.P.R. Discussion Papers.
    6. Miranda, Mario J & Helmberger, Peter G, 1988. "The Effects of Commodity Price Stabilization Programs," American Economic Review, American Economic Association, vol. 78(1), pages 46-58, March.
    7. Townsend, Robert M., 1977. "The eventual failure of price fixing schemes," Journal of Economic Theory, Elsevier, vol. 14(1), pages 190-199, February.
    8. Bohman, Mary & Jarvis, Lovell, 1990. "The International Coffee Agreement: Economics of the Nonmember Market," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 17(1), pages 99-118.
    9. Arrow, Kenneth J & Lind, Robert C, 1970. "Uncertainty and the Evaluation of Public Investment Decisions," American Economic Review, American Economic Association, vol. 60(3), pages 364-378, June.
    10. Danthine, Jean-Pierre, 1978. "Information, futures prices, and stabilizing speculation," Journal of Economic Theory, Elsevier, vol. 17(1), pages 79-98, February.
    Full references (including those not matched with items on IDEAS)


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:1546. 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: (Roula I. Yazigi). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.