Intermodal and Intramodal Competition in Passenger Rail Transport
27 Pages Posted: 22 Aug 2005
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Intermodal and Intramodal Competition in Passenger Rail Transport
Date Written: April 2005
Abstract
The objective of the paper is to elaborate a simulation model to analyze inter and intramodal competition in the transport industry, based on game theory models. In our setting, consumers choose a transport mode and an operator to travel on a given city-pair; operators strategically decide on prices for the types of service they provide. We derive the market equilibrium and simulate potential scenarios. In particular, we measure the impact of entry by a low cost train operator and the effect of a kerosene tax. Hence, our framework could serve as a tool to measure the effectiveness of competition on a relevant market or to design marketing strategies. More generally, it can be applied in cases of oligopolistic competition when detailed data are not available.
Keywords: Product differentiation, relevant transport market, simulation model
JEL Classification: C35, C81, L11, L13, L92, L93, L98
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Intermodal and Intramodal Competition in Passenger Rail Transport
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