Pels, A. and Medda, F. (2012). Modelling public and private provision: The case of the railway services Papers in Regional Science, 91(3):654--657.

Affiliated author

Eric Pels
Publication year

2012

Journal

Papers in Regional Science

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Railway provision is often characterized by the intervention of either the public or private sector as network and/or infrastructure operator. In this paper we aim to develop a model of passenger railway provision where we assume that the public operator suffers a relative inefficiency. In relation to the public, private and the participation of both in the railway provision, we identify in the model different efficiency-based decision rules. The decision rules establish in which configuration welfare is maximized and bring to light the relative inefficiency of the public sector. The results give insight into how a reliable threat of private intervention can be used to maximize social welfare. {\textcopyright} 2012 RSAI.