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Intercity bus deregulation in Germany – Intramodal and intermodal effects after two years

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  • Knorr, Andreas
  • Lueg-Arndt, Andreas

Abstract

At the THREDBO 12 Durban Conference in 2011, in a paper entitled “The Case for Intercity Bus Deregulation in Germany” (Knorr, Eisenkopf, Arndt and Burgdorf, 2011), we presented our ex ante assessment of the potential effects of intercity bus deregulation in Germany. This deregulation finally took effect January 1st, 2013. Our analysis led us to expect that substantial economic benefits were likely to accrue to the travelling public and society as a whole. In particular, we assumed that (potential) passengers – especially those from lower income brackets – would stand to gain massively from lower prices and a larger variety of travel options due to overlapping competing networks, at least on trunk routes (of which substantially more exist in Germany than in the UK, the USA or Sweden, given the country's polycentric economic geography, its high population density and very even spatial distribution of the population). Further, we expected that these economic benefits would not be limited to intercity bus travellers, as we also held that the imminent liberalization should force Deutsche Bahn AG to lower prices for their rail services and to improve the quality of its competing offerings. Last but not least, we stressed the crucial role of competition policy for these economic benefits to fully materialize. Our main concern then was that incumbent Deutsche Bahn AG might attempt to abuse the massive pre-liberalization dominance it had held on the regulated intercity bus market, in combination with its nearly intact de facto monopoly on long-distance railroad services, to stifle the genesis of this new market in its early stages with the aim to undermine the rise of potent intra- and intermodal competitors. In this paper for THREDBO 14, we contrast our 2011 projections with the observable intra- and intermodal effects in the two years since the German intercity bus market has been liberalized. In addition, we provide an overview of the corporate strategies of the new intercity bus operators and the strategic adjustments implemented by Deutsche Bahn AG.

Suggested Citation

  • Knorr, Andreas & Lueg-Arndt, Andreas, 2016. "Intercity bus deregulation in Germany – Intramodal and intermodal effects after two years," Research in Transportation Economics, Elsevier, vol. 59(C), pages 323-329.
  • Handle: RePEc:eee:retrec:v:59:y:2016:i:c:p:323-329
    DOI: 10.1016/j.retrec.2016.06.005
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    1. Laaser, Claus-Friedrich, 1991. "Wettbewerb im Verkehrswesen: Chancen für eine Deregulierung in der Bundesrepublik," Open Access Publications from Kiel Institute for the World Economy 424, Kiel Institute for the World Economy (IfW Kiel).
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    1. Burgdorf, Christian & Eisenkopf, Alexander & Knorr, Andreas, 2018. "User acceptance of long distance bus services in Germany," Research in Transportation Economics, Elsevier, vol. 69(C), pages 270-283.
    2. Blayac, Thierry & Bougette, Patrice, 2017. "Should I go by bus? The liberalization of the long-distance bus industry in France," Transport Policy, Elsevier, vol. 56(C), pages 50-62.
    3. Burgdorf, Christian & Eisenkopf, Alexander, 2018. "Effects of road tolls for intercity buses on travel activities and the choice of means of transport in German long-distance passenger transport," Research in Transportation Economics, Elsevier, vol. 72(C), pages 92-105.
    4. Brand, Christina & Sieg, Gernot, 2020. "The impact of delays on the welfare effects of on-track competition: The case of transfer passengers with operator-tied tickets," Research in Transportation Economics, Elsevier, vol. 80(C).
    5. Gaggero, Alberto A. & Ogrzewalla, Lukas & Bubalo, Branko, 2019. "Pricing of the long-distance bus service in Europe: The case of Flixbus," Economics of Transportation, Elsevier, vol. 19(C), pages 1-1.
    6. Van Acker, Veronique & Kessels, Roselinde & Palhazi Cuervo, Daniel & Lannoo, Steven & Witlox, Frank, 2020. "Preferences for long-distance coach transport: Evidence from a discrete choice experiment," Transportation Research Part A: Policy and Practice, Elsevier, vol. 132(C), pages 759-779.
    7. de Haas, Samuel & Herold, Daniel & Schäfer, Jan Thomas, 2022. "Entry deterrence due to brand proliferation: Empirical evidence from the German interurban bus industry," International Journal of Industrial Organization, Elsevier, vol. 83(C).
    8. von Arx, Widar & Thao, Vu Thi & Wegelin, Philipp & Maarfield, Simon & Frölicher, Jonas, 2018. "The development of international passenger rail services from 2007 to 2016: The case of Switzerland," Research in Transportation Economics, Elsevier, vol. 69(C), pages 326-336.
    9. Fageda, Xavier & Sansano, Sergi, 2018. "Factors influencing prices and frequencies in the interurban bus market: Evidence from Europe," Transportation Research Part A: Policy and Practice, Elsevier, vol. 111(C), pages 266-276.
    10. Alexander Eisenkopf & Andreas Knorr, 2021. "Ein innovativer Regulierungsansatz zur Belebung des Wettbewerbs im Schienenpersonenfernverkehr [An Innovative Regulatory Approach to Stimulate Competition in Long-Distance Passenger Rail Transport]," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 101(6), pages 446-453, June.
    11. Blume, Maximilian & Oberländer, Anna Maria & Röglinger, Maximilian & Rosemann, Michael & Wyrtki, Katrin, 2020. "Ex ante assessment of disruptive threats: Identifying relevant threats before one is disrupted," Technological Forecasting and Social Change, Elsevier, vol. 158(C).
    12. Florent Laroche & Ayana Lamatkhanova, 2020. "Effects of open access competition on prices and frequencies on the interurban railway market: evidence from Europe," Working Papers halshs-02930864, HAL.
    13. Borbely, Daniel, 2019. "A case study on Germany’s aviation tax using the synthetic control approach," Transportation Research Part A: Policy and Practice, Elsevier, vol. 126(C), pages 377-395.

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    More about this item

    Keywords

    Intercity bus services in Germany; Intramodal and intermodal effects of liberalization;

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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