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Regulating the regulator: The impact of professional procuring bodies on local public transport policy and its effectiveness

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  • Longva, Frode
  • Osland, Oddgeir

Abstract

During the past 15 years competitive tenders have become a common procedure when procuring local bus services in Europe. In particular, tenders with gross cost contracts and the so-called Scandinavian model have gained popularity, resulting in a vast amount of research on optimal contractual relationships between government and operators. This paper pays attention to a rather neglected part of the Scandinavian model: the construction of professional procuring bodies and their relationship to the local public administration, focusing on its implications for policy steering and service performance. The paper outlines briefly two different perspectives of analyses of organisational models: one perspective is anchored in principal-agent theory and institutional economics; and the other perspective in political science. Empirically, the article is based on an evaluation of the relation between two Norwegian counties and the administrative company responsible for planning and procuring public transport services. This evaluation indicates, firstly, important common challenges for the county administration due to lack of regional administrative competencies in relation to the administrative company, which also hampers the county's role as coordinator of policy areas of importance for public transport. Secondly, due to increased transaction costs, the establishment of administrative companies does not seem compatible with contracts relying on net cost solutions with huge scope for operator initiatives.

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  • Longva, Frode & Osland, Oddgeir, 2010. "Regulating the regulator: The impact of professional procuring bodies on local public transport policy and its effectiveness," Research in Transportation Economics, Elsevier, vol. 29(1), pages 118-123.
    • Handle: RePEc:eee:retrec:v:29:y:2010:i:1:p:118-123
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    References listed on IDEAS

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    1. Bekken, Jon-Terje & Longva, Frode & Fearnley, Nils & Osland, Oddgeir, 2006. "Norwegian experiences with tendered buss services," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 33, pages 29-40.
    2. O'Sullivan, Patrick J. & Patel, Toral, 2004. "Fragmentation in transport operations and the case for system integrity," Transport Policy, Elsevier, vol. 11(3), pages 215-225, July.
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    Cited by:

    1. Andrea ZATTI, 2012. "New Organizational Models In European Local Public Transport: From Myth To Reality," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 83(4), pages 533-559, December.
    2. Lowe, Christopher & Wright, Robert, 2018. "Institutional arrangements for greater inter-modality between bicycles and buses: A Melbourne case study," Research in Transportation Economics, Elsevier, vol. 69(C), pages 369-376.
    3. Aarhaug, Jørgen & Fearnley, Nils & Gregersen, Fredrik A. & Norseng, Robert Bjørnøy, 2018. "20 years of competitive tendering in the Norwegian bus industry – An analysis of bidders and winning bids," Research in Transportation Economics, Elsevier, vol. 69(C), pages 97-105.
    4. Hansson, Lisa, 2013. "Hybrid steering cultures in the governance of public transport: A successful way to meet demands?," Research in Transportation Economics, Elsevier, vol. 39(1), pages 175-184.
    5. Andrea ZATTI, 2011. "Organizational models in European local public transport: is the new paradigm really dominant," Departmental Working Papers 2011-29, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    6. Aarhaug, Jørgen & Farstad, Eivind & Fearnley, Nils & Halse, Askill Harkjerr, 2018. "Express coaches: An up-hill battle after liberalization?," Research in Transportation Economics, Elsevier, vol. 72(C), pages 82-91.
    7. Pedro, Marisa J.G. & Macário, Rosário, 2016. "A review of general practice in contracting public transport services and transfer to BRT systems," Research in Transportation Economics, Elsevier, vol. 59(C), pages 94-106.
    8. Nerhagen, Lena & Brandt, Daniel & Mortazavi, Reza, 2023. "Use of public transport as a means to reach national climate objectives - On the importance of accounting for spatial differences and costs," Transport Policy, Elsevier, vol. 131(C), pages 56-65.
    9. Hirschhorn, Fabio & van de Velde, Didier & Veeneman, Wijnand & ten Heuvelhof, Ernst, 2020. "The governance of attractive public transport: Informal institutions, institutional entrepreneurs, and problem-solving know-how in Oslo and Amsterdam," Research in Transportation Economics, Elsevier, vol. 83(C).

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