The impact of ‘competition for the market’ regulatory designs on intercity bus prices

Javier Asensio*, Anna Matas

*Corresponding author for this work

Research output: Contribution to journalArticleResearchpeer-review

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Abstract

Spain regulates its intercity bus market by means of a ‘competition for the market’ mechanism, whose design has been modified several times in the last years. This implies that current services are operated under contracts whose conditions are heterogeneous. We take advantage of such fact to empirically measure the impact that regulatory designs may have on fares paid by the users. Controlling for the different determinant of bus prices at route level the results show very large differences between routes whose contracts were awarded under relatively open conditions compared to regionally regulated routes or old contracts whose concessions were extended in 1987 and have not been retendered since then. The observed difference between the cheapest and the most expensive services is to a great extent explained by the difference in the regulatory designs used to award each contract.

Original languageEnglish
Article number101310
Number of pages9
JournalResearch in Transportation Economics
Volume100
DOIs
Publication statusPublished - Sept 2023

Keywords

  • Competition for the market
  • Competitive tendering
  • Intercity buses
  • Regulation

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