IDEAS home Printed from https://ideas.repec.org/a/eee/jotrge/v16y2008i4p278-291.html
   My bibliography  Save this article

Examining the cost structure of urban bus transit industry: does urban geography help?

Author

Listed:
  • Cubukcu, K. Mert

Abstract

The purpose of this paper is to expand empirical research on bus transit operation costs and test the hypothesis that physical and geographical characteristics are plausible explanatory cost factors. A translog cost function has been estimated, using a panel dataset of 1053 observations over 1996–2002 for a cross-section of 264 transit bus agencies in the US, combined with geographical and physical data processed with GIS technology. The results confirm the importance of geographical factors as determinants of bus transit costs. The trade-offs between geographical factors in shaping the frontier between economies and diseconomies of density are assessed. The implications of the results for public policy regarding competition are discussed.

Suggested Citation

  • Cubukcu, K. Mert, 2008. "Examining the cost structure of urban bus transit industry: does urban geography help?," Journal of Transport Geography, Elsevier, vol. 16(4), pages 278-291.
    • Handle: RePEc:eee:jotrge:v:16:y:2008:i:4:p:278-291
    DOI: 10.1016/j.jtrangeo.2007.09.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0966692307000889
    Download Restriction: no
    File URL: https://libkey.io/10.1016/j.jtrangeo.2007.09.001?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. David A. Hensher & Paola Prioni, 2002. "A Service Quality Index for Area-wide Contract Performance Assessment," Journal of Transport Economics and Policy, University of Bath, vol. 36(1), pages 93-113, January.
    2. Karlaftis, Matthew G. & McCarthy, Patrick, 2002. "Cost structures of public transit systems: a panel data analysis," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 38(1), pages 1-18, January.
    3. Christensen, Laurits R & Jorgenson, Dale W & Lau, Lawrence J, 1975. "Transcendental Logarithmic Utility Functions," American Economic Review, American Economic Association, vol. 65(3), pages 367-383, June.
    4. Baumol, William J, 1977. "On the Proper Cost Tests for Natural Monopoly in a Multiproduct Industry," American Economic Review, American Economic Association, vol. 67(5), pages 809-822, December.
    5. Berndt, Ernst R. & Christensen, Laurits R., 1973. "The translog function and the substitution of equipment, structures, and labor in U.S. manufacturing 1929-68," Journal of Econometrics, Elsevier, vol. 1(1), pages 81-113, March.
    6. Massimo Filippini & Paola Prioni, 2003. "The influence of ownership on the cost of bus service provision in Switzerland - an empirical illustration," Applied Economics, Taylor & Francis Journals, vol. 35(6), pages 683-690.
    7. Massimo FILIPPINI & Rico MAGGI & Paola PRIONI, 1992. "Inefficiency In A Regulated Industry," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 63(3), pages 437-454, July.
    8. Kumbhakar, Subal C & Bhattacharyya, Arunava, 1996. "Productivity Growth in Passenger-Bus Transportation: A Heteroskedastic Error Component Model with Unbalanced Panel Data," Empirical Economics, Springer, vol. 21(4), pages 557-573.
    9. Judy Shaw-Er & Wang Chiang & Ya-Wen Chen, 2005. "Cost structure and technological change of local public transport: the Kaohsiung City Bus case," Applied Economics, Taylor & Francis Journals, vol. 37(12), pages 1399-1410.
    10. Bruno De Borger & Kristiaan Kerstens & Álvaro Costa, 2002. "Public transit performance: What does one learn from frontier studies?," Transport Reviews, Taylor & Francis Journals, vol. 22(1), pages 1-38, January.
    11. Viton, Philip A, 1981. "A Translog Cost Function for Urban Bus Transit," Journal of Industrial Economics, Wiley Blackwell, vol. 29(3), pages 287-304, March.
    12. Winston, Clifford, 1985. "Conceptual Development in the Economics of Transportation: An Interpretive Survey," Journal of Economic Literature, American Economic Association, vol. 23(1), pages 57-94, March.
    13. Miller, David R, 1970. "Differences among Cities, Differences among Firms, and Costs of Urban Bus Transport," Journal of Industrial Economics, Wiley Blackwell, vol. 19(1), pages 22-32, November.
    14. Christensen, Laurits R & Greene, William H, 1976. "Economies of Scale in U.S. Electric Power Generation," Journal of Political Economy, University of Chicago Press, vol. 84(4), pages 655-676, August.
    15. Viton, Philip A., 1997. "Technical efficiency in multi-mode bus transit: A production frontier analysis," Transportation Research Part B: Methodological, Elsevier, vol. 31(1), pages 23-39, February.
    16. Ingram, Gregory K. & Zhi Liu, 1999. "Determinants of motorization and road provision," Policy Research Working Paper Series 2042, The World Bank.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sakai, Hiroki & Shoji, Kenichi, 2010. "The effect of governmental subsidies and the contractual model on the publicly-owned bus sector in Japan," Research in Transportation Economics, Elsevier, vol. 29(1), pages 60-71.
    2. Corazza, Maria Vittoria & Guida, Umberto & Musso, Antonio & Tozzi, Michele, 2016. "A new generation of buses to support more sustainable urban transport policies: A path towards “greener” awareness among bus stakeholders in Europe," Research in Transportation Economics, Elsevier, vol. 55(C), pages 20-29.
    3. Hatzenbühler, Jonas & Cats, Oded & Jenelius, Erik, 2020. "Transitioning towards the deployment of line-based autonomous buses: Consequences for service frequency and vehicle capacity," Transportation Research Part A: Policy and Practice, Elsevier, vol. 138(C), pages 491-507.
    4. Maria Vittoria Corazza & Sandro Imbastaro & Marco Pascucci, 2020. "Regenerating Communities. New Life for a Local Railway: A Technological and Environmental Study," Sustainability, MDPI, vol. 12(9), pages 1-24, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mert Cubukcu, 2000. "Cost of Urban Bus Transit Operations and Geography of Service Territory," Regional and Urban Modeling 283600020, EcoMod.
    2. Cinzia Daraio & Marco Diana & Flavia Di Costa & Claudio Leporelli & Giorgio Matteucci & Alberto Nastasi, 2014. "Efficiency and effectiveness in the urban public transport sector: a critical review with directions for future research," DIAG Technical Reports 2014-14, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
    3. Maria Nieswand & Matthias Walter, 2010. "Cost Efficiency and Subsidization in German Local Public Bus Transit," Discussion Papers of DIW Berlin 1071, DIW Berlin, German Institute for Economic Research.
    4. Yves Croissant & William Roy & Joan Canton, 2013. "Reducing urban public transport costs by tendering lots: a panel data estimation," Applied Economics, Taylor & Francis Journals, vol. 45(26), pages 3711-3722, September.
    5. Avenali, Alessandro & Boitani, Andrea & Catalano, Giuseppe & D’Alfonso, Tiziana & Matteucci, Giorgio, 2016. "Assessing standard costs in local public bus transport: Evidence from Italy," Transport Policy, Elsevier, vol. 52(C), pages 164-174.
    6. Andrea Boitani & Marcella Nicolini & Carlo Scarpa, 2013. "Do competition and ownership matter? Evidence from local public transport in Europe," Applied Economics, Taylor & Francis Journals, vol. 45(11), pages 1419-1434, April.
    7. de Grange, Louis & Troncoso, Rodrigo & Briones, Ignacio, 2018. "Cost, production and efficiency in local bus industry: An empirical analysis for the bus system of Santiago," Transportation Research Part A: Policy and Practice, Elsevier, vol. 108(C), pages 1-11.
    8. Ripplinger, David G. & Bitzan, John D., 2018. "The cost structure of transit in small urban and rural U.S. communities," Transportation Research Part A: Policy and Practice, Elsevier, vol. 117(C), pages 176-189.
    9. Carlo Cambini & Massimiliano Piacenza & Davide Vannoni, 2007. "Restructuring Public Transit Systems: Evidence on Cost Properties from Medium and Large-Sized Companies," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 31(3), pages 183-203, November.
    10. Rinki Sarkar, 1998. "Economic Characteristics Of The Urban Bus Transit Industry- A Comparative Analysis Of Three Regulated Metropolitan Bus Corporations In India," Working papers 54, Centre for Development Economics, Delhi School of Economics.
    11. Giovanni Fraquelli & Massimiliano Piacenza & Graziano Abrate, 2004. "Regulating Public Transit Networks: How do Urban‐Intercity Diversification and Speed‐up Measures Affect Firms’ Cost Performance?," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 75(2), pages 193-225, June.
    12. Amaral, Miguel, 2008. "Public vs private management of public utilities - The case of urban public transport in Europe," Research in Transportation Economics, Elsevier, vol. 22(1), pages 85-90, January.
    13. Kurt Kratena & Mark Sommer & Gerhard Streicher & Simone Salotti & Juan Manuel Valderas Jaramillo, 2017. "FIDELIO 2: Overview and Theoretical Foundations of the Second Version of the Fully Interregional Dynamic Econometric Long-term Input-Output Model for the EU 27," WIFO Studies, WIFO, number 61880.
    14. Philippe Gagnepain & Marc Ivaldi & Catherine Muller-Vibes, 2011. "The Industrial Organization of Competition in Local Bus Services," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 32, Edward Elgar Publishing.
    15. Andreas Andrikopoulos & John Loizides, 1998. "Cost structure and productivity growth in European railway systems," Applied Economics, Taylor & Francis Journals, vol. 30(12), pages 1625-1639.
    16. Germà Bel, 2013. "Local government size and efficiency in capital-intensive services: what evidence is there of economies of scale, density and scope?," Chapters, in: Santiago Lago-Peñas & Jorge Martinez-Vazquez (ed.), The Challenge of Local Government Size, chapter 6, pages 148-170, Edward Elgar Publishing.
    17. Oliver, Matthew E., 2015. "Economies of scale and scope in expansion of the U.S. natural gas pipeline network," Energy Economics, Elsevier, vol. 52(PB), pages 265-276.
    18. Avenali, Alessandro & Boitani, Andrea & Catalano, Giuseppe & D’Alfonso, Tiziana & Matteucci, Giorgio, 2018. "Assessing standard costs in local public bus transport: A hybrid cost model," Transport Policy, Elsevier, vol. 62(C), pages 48-57.
    19. Barnum, Darold T. & Karlaftis, Matthew G. & Tandon, Sonali, 2011. "Improving the efficiency of metropolitan area transit by joint analysis of its multiple providers," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 47(6), pages 1160-1176.
    20. Batarce, Marco, 2016. "Estimation of urban bus transit marginal cost without cost data," Transportation Research Part B: Methodological, Elsevier, vol. 90(C), pages 241-262.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jotrge:v:16:y:2008:i:4:p:278-291. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-transport-geography .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.