Competition or Complementarity: Regulatory Options for Urban Road Transit in Brazilian Cities

This chapter describes how, until the first half of the 1990s, the scenario in Brazilian local public transport was apparently stable. Following a period of change in the early eighties, local bus markets had consolidated under a strictly non-competitive public regulation and privately controlled operation. Brazilian local bus markets could than be characterized, within each urban region, as being structured in a monopolisitic competition manner, as route-by-route concessions were gathered into an operational basin where just one operator could run services. So, in-the-market competition between incumbents was limited to the borders of operational basins, usually a high-demand transportation corridor. In this context, incumbents were able to grow and a significant concentration process took place. This concentration process extend beyond local markets: the bus market at the national level has become increasingly controlled by groups with economic interests in many local markets, as well as in the medium- and long-distance bus industry. By 1995, this market structure began showing clear signs of crisis, and the reasons for this crisis could essentially be traced to the anti-competitive character of bus regulation—at local, regional and national levels—and to some important changes in urban structure and day-to-day mobility requirements. This chapter aims to provide a critical vision of these arrangements, in the sense that the objective is to analyze how new local regulatory arrangements treated the core question regarding the insertion of previously competitive operators into an essentially protective regulatory framework. Following the introductory section, a brief explanation of typical local bus market regulation in Brazil is presented. The third section provides a description of the methodological guidelines used for evaluating regulatory changes as appropriate policy responses to the emergence of a new market scenario. The fourth section is based on the presentation of evaluation outcomes regarding competition and complementarity issues. The final section summarizes the main conclusions of the study.

Language

  • English

Media Info

  • Media Type: Print
  • Features: References;
  • Pagination: pp 331-341
  • Monograph Title: Competition and Ownership in Land Passenger Transport

Subject/Index Terms

Filing Info

  • Accession Number: 01003336
  • Record Type: Publication
  • ISBN: 0080445802
  • Files: TRIS
  • Created Date: Aug 22 2005 11:33AM