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Intermodal Competition in the London-Paris Passenger Market: High-Speed Rail and Air Transport

Tinbergen Institute Discussion Paper 09-051/3

26 Pages Posted: 11 Jun 2009  

Christiaan Behrens

VU University Amsterdam - Department of Economics

Eric A. J. H. Pels

Vrije Universiteit - Department of Spatial Economic

Date Written: June 9, 2009

Abstract

This paper studies inter- and intra-modal competition in the London-Paris passenger market. Using revealed preference data, we estimate nested and mixed multinomial logit models to examine passenger behaviour in the London-Paris market. We present a case study on the relocation of Eurostar services from Waterloo International to St Pancras International station. The results show that competition is present in this market. Demand is elastic, and passengers are heterogeneous in their valuation of fares and accessibility. Aviation and high-speed rail are homogenous in unobserved effects. The large market share of the Eurostar and the withdrawal of aviation alternatives indicate that competition will decline in the long-run.

Keywords: inter- and intra-modal competition, nested logit, mixed logit, aviation, rail

JEL Classification: R40, R41

Suggested Citation

Behrens, Christiaan and Pels, Eric A. J. H., Intermodal Competition in the London-Paris Passenger Market: High-Speed Rail and Air Transport (June 9, 2009). Tinbergen Institute Discussion Paper 09-051/3. Available at SSRN: https://ssrn.com/abstract=1416663 or http://dx.doi.org/10.2139/ssrn.1416663

Christiaan Behrens (Contact Author)

VU University Amsterdam - Department of Economics ( email )

De Boelelaan 1105
1081 HV Amsterdam
Netherlands

Eric A.J.H. Pels

Vrije Universiteit - Department of Spatial Economic ( email )

De Boelelaan 1105
1081HV Amsterdam
Netherlands
+31-20-4446049 (Phone)
+31-20-4446004 (Fax)

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