Transport Economics Theory, Application and Policy

by Mallard, Graham; Glaister, Stephen

• ISBN13: 9780230516878
• ISBN10: 0230516874
• Format: Hardcover
• Copyright: 2008-04-15
• Publisher: Red Globe Pr

Summary

Transport Economics introduces students to the key areas of the transport sector, combining lucid explanation of theory with detailed case studies from across the European Union. The book applies microeconomic theory and isaimed at students taking their first course in the subject.

Author Biography

GRAHAM MALLARD is currently part of the PhD programme at the University of Bathand holds degrees in Economics and Education from Cambridge University and the University of Sunderland, UK. He is an experienced teacher of transport economics at a range of levels.

STEPHEN GLAISTER CBE is Professor of Transport and Infrastructure at Imperial College, University of London, UK. He is an eminent transport economist and adviser to Transport for London.

Table of Contents

Acknowledgements	p. xi
Introduction	p. xiii
Setting the Scene	p. 1
The History of Transport in Europe	p. 3
Railways	p. 3
Roads and automobiles	p. 6
Shipping	p. 10
Aircraft	p. 13
Canals	p. 16
Lessons from History	p. 17
The Importance of Transport in the UK and Eurpe	p. 21
Statistical importance	p. 21
Theoretical importance	p. 29
The Theory of Markets: An Overview	p. 33
The Demand for Transport	p. 35
Important definitions	p. 35
Determinants of demand	p. 36
The problem of the peak	p. 41
Elasticity of demand	p. 49
Market price	p. 60
Market welfare	p. 61
Markets in action: The effects of 11 September 2001 on the low-cost airlines	p. 63
The problem of rural demand	p. 64
Markets, Costs and Revenues	p. 67
Important definitions	p. 67
Classification of costs according to their nature	p. 68
Classification of costs according to their scale	p. 70
Other types of cost important in transport economics	p. 79
Classification of revenue	p. 80
Profit maximisation and alternative objectives	p. 83
Market structures	p. 90
Competition and Contestability	p. 91
The assumptions and the model	p. 91
Normal and abnormal profit	p. 92
The adjustment mechanism	p. 93
Efficiency	p. 94
A fundamental model	p. 96
A transport case study: Tramp shipping	p. 97
Contestable markets	p. 101
Monopoly	p. 103
Definition and barriers to entry	p. 103
The model	p. 107
Price discrimination	p. 110
Yield management	p. 115
European competition policy	p. 116
Public service vehicle operations in Britain	p. 119
Natural monopolies	p. 122
Monopolistic Competition	p. 125
The model and outcomes	p. 125
Competition	p. 126
The road-haulage market in the European Union and Great Britain	p. 127
The taxi market in the City of Leicester	p. 132
Oligopoly	p. 137
Definition and model	p. 137
Location decisions	p. 139
The European air industry	p. 141
The global car industry	p. 147
Market Failure in the Transport Sector: An Overview	p. 149
Externalities	p. 151
Definitions and the model	p. 151
Missing markets	p. 153
A lack of ownership	p. 156
The transport sector and global warming	p. 157
Congestion as an externality	p. 162
The positive externalities of cycling	p. 164
Sustainable development and ethics	p. 165
Public and Demerit Goods	p. 167
Public goods: The theory	p. 167
Galileo	p. 168
Street lighting	p. 169
Provision of roads	p. 171
The theory of demerit goods	p. 173
Inequality, Poverty and Asymmetric Information	p. 177
Inequality and poverty	p. 177
Inequality in Europe	p. 178
The exacerbation caused by the transport sector	p. 179
Asymmetric information - The market for lemons	p. 181
Policy: An Overview	p. 183
Privatisation and Deregulation	p. 185
Arguments in favour of privatisation and deregulation	p. 186
Arguments in favour of nationalisation and against deregulation	p. 189
Political risk and the need for governmental commitment in privatisation	p. 190
The methodology of privatisation	p. 192
The privatisation and deregulation of British rail	p. 193
The privatisation of British ports	p. 201
The privatisation and deregulation of British buses	p. 202
Competitive tendering in bus markets across Europe	p. 208
A summary of the experiences in Germany and Ireland	p. 209
Project Appraisal: Cost-Benefit Analysis	p. 211
The need for, and types of, cost-benefit analysis	p. 211
The methodology of cost-benefit analysis	p. 212
Valuing non-marketed products	p. 216
Decision-making in practice	p. 219
The limitations of cost-benefit analysis	p. 219
The COBA model	p. 220
Transport Investment	p. 225
Central or local government investment	p. 226
European Community investment	p. 226
Private investment and public-private partnerships	p. 228
The Channel Tunnel	p. 229
General Forms of Government Intervention	p. 231
Introduction	p. 231
Command and control solutions	p. 232
Taxation	p. 236
Tradable permits	p. 242
Case studies of the three options	p. 245
Bureaucratic rent-seeking	p. 246
Tackling Traffic Congestion	p. 249
The situation	p. 249
The principles behind road-user charging	p. 250
Experiences and types of road-user charging	p. 251
The methodology of road-user charging	p. 253
How widely should charging be implemented?	p. 272
The case for building more road capacity	p. 272
Issues to be resolved to make road-pricing a practical national policy	p. 273
The Future	p. 277
Concluding Remarks	p. 279
The major challenges ahead	p. 279
Other trends	p. 280
Words of perceived wisdom	p. 280
Mathematical Appendix	p. 283
A straight-line demand curve	p. 283
A straight-line supply curve	p. 284
Equilibrium	p. 285
Substitute and complementary products	p. 285
Elasticities	p. 287
More sophisticated demand-and-supply analysis	p. 288
Consumer surplus	p. 290
Producer surplus	p. 291
Total, marginal and average costs	p. 292
Total, average and marginal revenue	p. 294
Profit-maximising condition	p. 295
Bibliography	p. 297
Index	p. 305
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