Static traffic models, in the tradition of Walters (1961), typically feature a ‘‘demand curve’’ giving the vehicle flow demanded for each unit travel time (inverse speed). Traditionally, the demand curve declines because people want to drive more as travel times fall. This paper proposes that the vehicle flow demanded can, instead, plausibly rise with unit travel time (a phenomenon we call ‘‘hyperdemand’’)

This study aims to find empirical evidence whether local feeder ports as small-scale investments in public infrastructure affect the economic activity at the sub-district level. The motivation for the study originated from the fact that the public invests heavily in small-scale projects when market failures occur. However, there is a lack of empirical studies on the impact of these investments because

This paper examines how the opening of a subway affects urban passenger transport modes. The DID method is applied to a dataset of 43 Chinese cities where subway development plans were approved between 1994 and 2015. This paper finds strong evidence that subways affect people's choice of travel modes. Specifically, every new subway line put into operation annually diverts about 4.1 percent of bus passengers

This paper synthesises the findings of surveys of consumer willingness-to-pay for vehicle automation. Some studies report only mean or median estimates of willingness-to-pay for vehicle automation. Other studies provide data enabling demand functions to be derived. Six demand functions have been estimated and are compared. Maximum willingness-to-pay (around 25,000 to 40,000 US dollars) exceeds low

We analyze the differences between corner solution and survival models in estimating the marginal cost of track renewals. Both approaches describe the renewal process in intuitively similar ways but have several methodological distinctions. Using Swedish data for the 1999–2016 period, results suggest the median marginal costs per gross ton-km from corner solution and survival models are SEK 0.0066

This paper analyzes the flight-frequency choices of a monopoly airline serving a hub-and-spoke network with asymmetric demands. In the 3-city hub-and-spoke network, demand is allowed to differ across markets. Analysis is done separately for two distinct passenger types: those who assign zero cost to layovers, and those who assign a very high cost. Both cases result in a higher flight frequency on the

We study entry deterrence in air transport markets with a full-service (FS) carrier (the incumbent) and a low-cost (LC) carrier (the potential entrant). We consider a vertically differentiated product model where airlines have different operating cost and different generalized prices so they compete in ticket prices and frequencies. Thus, more frequency allows airlines to increase ticket prices without

Proponents of the Mobility as a Service concept claim that subscriptions to alternative modes can effectively reduce car ownership and the adverse effects of underpriced car use. We test this hypothesis in a microeconomic model with endogenous mode choice as well as car and subscription ownership. The model contains congestible urban rail and car sharing options as substitutes of underpriced private

Following the decision of the European Court of Justice in 2002, which overruled its member countries’ Bilateral Air Services Agreements (BASAs), the EU has been negotiating Air Services Agreements as a block with third countries within the framework of its External Aviation policy. This paper explores whether routes governed by this policy have lower fares and higher service quality and load factors

In this paper we study how the spatial arrangement of transit lines (lines structure) influences scale economies in public transport. First we show that the degree of scale economies (DSE) increases discretely whenever passenger volume induces a change in lines structure. The technical elements behind this are explained by using a new three-dimensional concept called directness, encompassing number

Transportation economists apply different labor supply models when examining transport pricing: (i) endogenous working hours; (ii) endogenous workdays; (iii) labor supply as a residual. We study whether the optimal level of transport taxes that changes the relative cost of labor supply margins is robust against the model applied. We find surprisingly strong differences in the level of optimal fuel

Studies of airline mergers have largely focused on measuring the impact of mergers on average airfares. As a result, they may not sufficiently reveal the full range of price effects given the complexity of this industry. To address such industry intricacy, I investigate prices of merging firms and their rivals in response to the United-Continental merger on three types of routes: those include one

It is well known that price and quantity regulation are not equivalent under uncertainty. This asymmetry has been a factor in the debate about whether to use taxes or Tradable Permit Schemes (TPS) for controlling greenhouse gas emissions. We analyze the allocative efficiency of a TPS for a congestible facility such as an airport, a road, a recreational area, or a museum that experiences supply and

It is currently unknown in which city environments, automated vehicles could be deployed at reasonable speeds, given safety concerns. We analytically and numerically assess the impact of automation for optimal vehicle size, service frequency, fare, subsidy and degree of economies of scale, by developing a model that is applied for electric vehicles, with data from Chile and Germany, taken as illustrative

Car scrappage schemes are generally introduced to upgrade the car fleet to reduce environmental pressures from private transportation. The aim of this paper is to present a combined use of two counterfactual techniques (RDD and DiD) to quantify the impact of Italian car scrappage schemes of 2007–2009 on the deregistration of cars. The empirical assessment of the policy effectiveness is made possible

This paper analyzes the effects of changes in aeronautical charges as brought by several airport management regimes on the air transport industry. Airlines compete on both price and non-prices variables, where connecting passengers have asymmetric valuations of flight frequencies in different legs. Changes in landing fees trigger airlines reactions on flight frequencies and airfares, whose sign depends

This study provides further empirical evidence on pricing by international airline alliances. The paper covers a long sample period, which runs from 1997 to 2016, and it supplements the usual USDOT fare data with confidential fare data reported by the foreign alliance partners of US carriers. The empirical results for connecting service match earlier findings, with alliances charging lower fares than

At the end of 2005, Autostrade per l’Italia (ASPI) and the Italian traffic police progressively deployed along the Italian tolled motorway network an average speed enforcement system, named Safety Tutor, able to determine the average speed of vehicles over a long section to encourage drivers to comply with speed limits and improve safety. The aim of this study was to empirically test the extent to

This paper develops an economic model of driver behaviour and discusses the traffic safety implications when the driver listens to the radio, uses a mobile phone, and has passengers in the car. The main findings are that, even though engaging in the three distractions reduce the driver's concentration and his driving performance, they can improve the traffic safety situation for both himself and the

In a controlled lab experiment, we investigate hypothetical biases in the value of time by comparing stated preference (SP) and revealed preference (RP) values attached to unexpected waiting times. The SP and RP choice sets are identical in terms of design with the only difference being that the RP choices have real consequences in terms of unexpected waiting times and monetary incentives. We find

This paper is concerned with the Wider Economic Impacts (WEIs) of transport improvements that arise via scale economies of agglomeration. It reviews the background theory and empirical evidence on agglomeration, explains the link between transport and agglomeration, and describes a three step procedure to appraise agglomeration impacts in a number of different settings. It includes new analytical work

We study empirically the price dynamics in the long-distance bus market using posted fares by Flixbus, the market leader in Europe. We find that, at a given point in time, the fare increases with the number of sold seats. This result largely explains, why the lowest available fare increases as the departure date approaches. No evidence is found in favor of intertemporal price discrimination, probably

With a view to construct a new framework to assess the benefits of freight transport improvements, an Economic Order Quantity model with uncertain lead time demand is equipped with detailed transport costs. The problem is to minimise total logistics cost by choosing shipment size, vehicle size and reorder point subject to constraints on vehicle size and annual transport capacity. An analytical solution

This paper uses the bottleneck model of Vickrey (1969) to empirically measure the social cost of traffic congestion in the US. Using a detailed trip-level data, we estimate extra travel time over and above hypothetical free-flow travel time, which we call “queuing time”, for each average commute trip. The estimated individual queuing time implies that the annual cost of congestion borne by all US commuters

This paper considers the following scheme for the joint provision of transportation infrastructure: two regions jointly establish an operator for the infrastructure who is then responsible for collecting the user charges. The two regions make financial contributions to cover the costs of the infrastructure investment, and the revenue from user charges is distributed according to the share of contribution

In this paper we study the effect of contract design on the performance of railway maintenance in Sweden, using a panel data set over the period 2003–2013. The effect of incentive intensity is estimated, showing that the power of incentive schemes improve performance as measured by the number of infrastructure failures. In addition, we show that the structure of the performance incentive schemes has

We study two districts’ voluntary co-financing of a centrally provided public good, e.g., transport infrastructure. Outcomes are compared to a surplus-maximizing level of public good provision. We show that both co-financing and lobbying raise the amount of public good provided. Co-financing and lobbying are substitutes. Co-financing (or co-financing combined with lobbying) raises the provision of

We explore how transport improvements impact agglomeration defined as accessibility and thereby productivity in mid-Sweden including Stockholm 1995–2006. We apply an accessibility index derived from a multi-modal transport model. This is a more accurate measure of agglomeration than those previously used and also necessary for understanding how governments can impact agglomeration, and thereby productivity

Weather shocks frequently impair the smooth functioning of transportation systems. We use a dataset consisting of 2.14 million flight departures from ten large U.S. airports between January 2012 and September 2017, and estimate the effects sudden onset events, i.e., precipitation and wind, and slow onset events, i.e., temperature, have on departure delay. For sudden onset events, we apply a difference-in-difference

This paper addresses the problem of measuring the welfare benefits of a transport improvement. We formulate and analyze a rich spatial model that allows for spillovers, matching and income tax, in a setting with multiple work and residential locations and very general worker heterogeneity. The conventional consumer surplus captures part of the benefits and is calculated based on predictions of changes

This paper examines the impact of slot restrictions as a determinant of scarcity rent. I took advantage of an exogenous regulatory change: the removal of slots at Newark Airport in October 2016. The results from the difference-in-differences estimation with and without propensity score matching or weighting methods suggest that after the slot removal at Newark Airport, the average fare on routes to

In this study we analyse the impact of the EU Airport Charges Directive on the level of aeronautical charges for EU airports serving between 2 and 20 million passengers, over the period 2008–2017, using a difference-in-differences research design. We find that the transposition of the Airport Charges Directive into national legislation has led to a statistically significant reduction in the level of

Parking occupancy sensors are devices that assist search of vacant parking. The interplay between two government policies, installation of sensors and pricing parking, is studied. When parking is congested and the uniform price is optimal, installation of sensors raises the price, increases turnover of parking. If price discrimination is considered, sensored parking should be cheaper than non-sensored

American, Delta, and United have organized their operations into extensive hub-and-spoke networks that typically require passengers originating and concluding travel in non-hub cities to board a connecting flight at a hub en route to the final destination. From the passenger perspective, layovers are detrimental since the addition to total travel time relative to a nonstop itinerary is a cost incurred

The first-best solution for a transportation bottleneck is to impose a first-best peak-load toll that varies continuously over time, reaching its maximum value at the most desirable crossing time. This eliminates all wasteful queueing. With homogeneous values of time, the private costs of consumers are unchanged, but the large maximum value of the first-best toll may make it politically infeasible

In this paper, we develop a game theory model in which freight service providers seek to maximize their expected utility by competing for business from shippers and also investing in security. The focus is on high-value cargo, which has been the target of attacks globally. Shippers reflect their preferences for freight service providers through the prices they are willing to pay which depend on quantities

In metropolitan areas, taxicab regulation often has exclusive cruising regulations that prevent taxis affiliated with one jurisdiction from picking up passengers in another. When multiple cities are in close proximity, empty return trips occurring after taxis drive passengers from one jurisdiction to another results in inefficiency. This source of inefficiency can be eliminated by creating a combined

We analyse distributional effects of four car-related tax instruments: an increase of the fuel tax, a new kilometre tax, an increased CO2-differentiated vehicle ownership tax, and a CO2-differentiated purchase tax on new cars. Distributional effects are analysed with respect to income, lifecycle category, and spatial dimensions. The analysed taxes are progressive over most of the income distribution

This paper explores a new phenomenon of tram development in Chinese cities where tram is used as an alternative transport system to drive urban development. The Suzhou National High-tech District tram was investigated as a case study. Two key findings are highlighted. Firstly, the new tramway was routed along the “path of least resistance” – avoiding dense urban areas, to reduce conflict with cars

This research analyses airlines' pricing decisions in response to changes in the market conditions. We estimate the effects of jet fuel price changes on European airfares at airline/route level by discriminating on the grounds of supplied capacity and markets’ competitive structure. Our results show that airlines tend to adjust fares asymmetrically following a “rocket and feather” behaviour. The asymmetric

In this paper, we extend to the literature on marginal wear and tear cost estimation in railways, by applying a panel vector autoregressive model to rail infrastructure renewals and maintenance costs, using an extensive dataset from Sweden. This study is significant given the inherent difficulties in modelling the substantial renewals element of infrastructure costs, as well as the need to account

This paper estimates the value consumers place on air travel on-time performance (OTP), and the extent to which airlines are motivated to improve their OTP. We find robust evidence that consumers value OTP and are willing to pay to avoid delays. Airlines can invest to improve OTP, but would independently choose to do so only if on-time performance improvement leads to increases in profitability. Using

We study impact of the political factors behind allocation of airport infrastructure grants under the American Recovery and Reconstruction Act (ARRA) of 2009. We find that – controlling for other factors – airports located in the districts with the larger Obama-McCain vote differential in November 2008 election received larger ARRA grants. At the same time, the district level election results are poor

This paper studies the behavior of the national air traffic control (ATC) centers in the EU as it relates to bargaining between a union and government. We analyze wage formation, the reactions of ATC's to a price-cap, the slow adoption of new technologies, the reluctance to vertically disintegrate, the slow standardization, and the failures of mergers of neighboring ATC's. The theory is illustrated

Safely integrating bicyclists onto roadways in the United States has become an important issue as the number of cyclists has steadily increased in recent decades. These concerns have led many city and state legislatures to pass laws requiring drivers to provide a minimum amount of distance between their vehicle and cyclists when passing them on roadways. Many believe these laws are ineffective in reducing

Related to the increased encouragement of public transport (PT) by policy-makers, over-crowding in PT has become a major issue worldwide. Whilst the impact of in-vehicle crowding on individuals' travel costs has been considered, we focus on aggregate welfare losses. We apply a Pigouvian framework to the case of subways and compute the economic cost of congestion (ECC). We combine data of the 14 metro

Attention is focussed on a type of strategic alliance of the container shipping industry: vessel sharing agreements. In such consortia carriers jointly provide—but independently sell—a liner service. The strategic alliances studied in this work have not been extensively analyzed in the theoretical literature; a new model is proposed that embodies their main distinguishing features. By it, an examination

Currently, all downtown tolls are “access tolls,” meaning they charge for gross access to a zone, but tolls levied on distance-traveled are on the horizon. This paper shows how such tolls affect the distribution of trip lengths. A static model is presented in which travelers with potentially different trip lengths decide whether to drive into a downtown zone governed by a Macroscopic Fundamental Diagram

The Swedish market for passenger railway services has been open to competition since the year 2010. Although minor entries have been made since this date, the incumbent SJ only faced substantial competition on the tracks when MTR entered the Stockholm-Gothenburg line in March 2015. Using unique Swedish ticket price data from operators' websites, this paper investigates what effects this entry has had

Travelers consider the average duration and the reliability of travel time when choosing their route. However, the relative importance of average travel time and reliability not only depends on the purpose of the trip, but also varies from one person to another. Users seek to minimize their travel costs leading to an equilibrium condition in which they choose routes in such a way that they cannot reduce

Will politics lead to over-building or under-building of transportation projects? In this paper, we develop a model of infrastructure policy in which politicians overdo things that have hidden costs and underperform tasks whose costs voters readily perceive. Consequently, national funding of transportation leads to overspending, since voters more readily perceive the upside of new projects than the

Left-hand drive (LHD) vehicles share higher road accident risks under left-hand traffic because of blind spot areas. Due to low import prices, the number of wrong-hand drive vehicles skyrockets in emerging countries like Georgia, Kyrgyzstan and Russia. I identify the causal effect of wrong-hand drive vehicles on road safety employing a new “backward version” of the synthetic control method. Sweden

Inter-regional spillovers of local public goods are the main cause of decentralization failure. Assuming that the quality of transportation infrastructure policy affects the strength of inter-regional spillovers, we compare a one-step scheduling design, in which all policies are chosen simultaneously, with a two-step scheduling design, in which transportation infrastructure policy is used to influence

This paper examines the impact of the crash of Alaska Airlines Flight 261 on the domestic fares of the crash carrier, using a difference-in-difference approach. The results show that the crash reduced fares of Alaska Airlines relative to those of its competitors only in the months right after the crash, indicating that the financial ramifications are not persistent.

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

Using a difference-in-differences technique, this paper examines the relationship between market competition and market price in the airline industry by presenting a case study of United and Continental Airlines merger. I find that, in nonstop markets, the price for routes formerly competitive between United and Continental Airlines increases significantly following the merger. This result is robust

This paper offers an empirical investigation of the relationship between air transport service and trade, using a panel of 20 Italian regions and 24 European countries observed, half-yearly, over the period 1998–2010. We apply a Newey-West two-step GMM estimator to produce estimates which are robust to the presence of heteroskedasticity and autocorrelation. Our findings suggest that air transport service

This paper analyzes three travel demand management policies designed to correct the shortcomings of license plate rationing (LPR). The first policy couples LPR with a new vehicle quota scheme that directly controls auto ownership. The other two policies turn the driving permit into a tradable commodity. They differ, however, in that one policy ties the permit to the license plate while the other bestows

Many public transport services are heavily subsidized. One of the main justifications is the expected beneficial effect on road congestion. Stockholm introduced congestion pricing in 2006 and the effects on car and public transport demand were carefully monitored. The change in prices provides unique estimates on price- and cross-price elasticities. This paper uses these data to model how the optimal

This paper studies analytically a tax reform where federal gasoline and car taxes are replaced by tolls decided by local authorities. This is particularly relevant in countries with high gasoline taxes like the EU or countries that introduce gasoline taxes like China. One of the major barriers in the reform is the allocation of revenues: when the goal of the federal government is to keep the gasoline