OPTIMAL BUS FARES. IN: URBAN TRANSPORT

This paper focuses on optimal fares on buses under first-best conditions. Traffic congestion and the non-optimal pricing of petrol, parking, railway journeys are simply ignored although enormously important but they are better understood than the problem of which this paper concentrates. This problem is to find out what marginal cost pricing of bus service consists of. One obvious answer is that if a bus run costs X and carries Y passengers and that if all these passengers travel the same distance, the marginal cost per passenger and hence the optimal fare is X/Y which is wrong. This ignores the point that X is a joint cost. Demand, unlike costs, is a matter of individual passenger journeys; but it is a function not only of fares but also of travel times. These, once the passengers have got to the bus stops, depend on frequency and speed.

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  • Supplemental Notes:
    • Originally published in: Journal of Transport Economics and Policy, IX, September, 280-86.
  • Corporate Authors:

    Edward Elgar Publishers

    William Pratt House, 9 Dewey Court
    Northampton, MA  United States  01060-3815
  • Authors:
    • Turvey, R
    • Mohring, H
  • Publication Date: 2003

Language

  • English

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Filing Info

  • Accession Number: 00973567
  • Record Type: Publication
  • ISBN: 1840645504
  • Files: TRIS
  • Created Date: May 18 2004 12:00AM