CHARGES AND SUBSIDIES IN TRANSPORTATION AND THEIR EFFECTS ON THE COMPETITION

In 1979 the prevailing transport principle in Sweden implying that all land transport modes should pay their overall costs was replaced by i) cost-responsibility based on efficiency (social marginal costs) and II) payment-responsibility based on political considerations. According to this, Swedish Rail has been relieved from infrastructural costs in order to be able to charge only for long long-run marginal costs. At the same time it was proclaimed that the question of whether road traffic pays more than its overall costs only is of political interest. Although the principle of marginal cost pricing has strong theoretical support, the principle in practice indicates that a "second-best" solution should be found. The main implications of marginal cost pricing are two-part tariffs and peak-load pricing. An implication of more questionable nature is the rejection of the principle of responsibility for overall social costs. With the current application of the principle there is a risk of distorting the competitive market mechanisms, ie, marginal cost pricing of one transport mode when competitors are compelled to charge average costs, might be a bad transport policy. For the covering abstract of the seminar see IRRD 283591. (TRRL)

• Availability:
  • Find a library where document is available. Order URL: http://worldcat.org/isbn/086050137X
• Supplemental Notes:
  • Transport Policy. Proceedings of Seminar J held at the 12th PTRC Summer Annual Meeting, University of Sussex, England, 10-13 July 1984, Volume P252.
• Corporate Authors:

  PTRC Education and Research Services Limited

  110 Strand
  London WC2,   England 
• Authors:
  • HANSSON, L
• Conference:
  • Planning & Transport Res & Comp, Sum Ann Mtg, Proc
• Publication Date: 1984

Media Info

• Features: Figures;
• Pagination: p. 31-40

Subject/Index Terms

• TRT Terms: Competition; Conferences; Costs; Externalities; Financing; Highways; Marginal costs; Needs assessment; Peak periods; Personality; Policy; Politics; Pricing; Public transit; Railroad transportation; Road pricing; Social factors; Sociology; Tariffs; Transportation; Transportation policy
• Identifier Terms: Statens Jarnvagar
• Uncontrolled Terms: Responsibility
• Geographic Terms: Sweden; United States
• Old TRIS Terms: National transportation policies
• ITRD Terms: 235: Competition; 8525: Conference; 224: Cost; 244: Financing; 612: Peak hour; 173: Policy; 744: Public transport; 1173: Rail bound transport; 2264: Responsibility; 240: Road pricing; 2253: Sociology; 8109: Sweden; 241: Tariff; 1155: Transport
• Subject Areas: Finance; Planning and Forecasting; Policy; Society; Transportation (General); I10: Economics and Administration; I72: Traffic and Transport Planning;

Filing Info

• Accession Number: 00451253
• Record Type: Publication
• Source Agency: Transport Research Laboratory
• ISBN: 086050-137-X
• Files: ITRD, TRIS
• Created Date: Nov 30 1985 12:00AM