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Theoretical And Methodological Issues Regarding Subsidies For Urban Public Transport Operators

Author

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  • Ioan RADU
  • Cleopatra SENDROIU
  • Mihai DEMETER
  • Florin CAZACU

Abstract

Until the effective application of “REGULATION (EC) No 1370/2007 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on public passenger transport services by rail and by road in Romania, the existing policy of subsidizing public transport companies generally consists in covering the difference between the total cost (usually higher) and revenue (usually lower) of the operator that are obtained by provisioning the public passenger transport. In this manner, by subsidizing the overall cost of public transport companies has led to a constantly growing financial effort for the local authority, in particular because there are no clear policies regarding the destination, volume and socio -economical effects of this subsidy. Likewise, in the absence of clear methodologies and procedures for correct identification and quantification of the volume and destination of the subsidy needed for operating the public passenger transport services, it`s financing is done in a relative subjective manner. In this paper we propose to bring to the fore a number of conceptual and procedural elements regarding “a more correct approach on the volume and destination of operational subsidies granted to the public transport companies. The aim of the research is to demonstrate that urban transport system development is conditioned by the need to amend the regulatory mechanism for according operating subsidies.

Suggested Citation

  • Ioan RADU & Cleopatra SENDROIU & Mihai DEMETER & Florin CAZACU, 2017. "Theoretical And Methodological Issues Regarding Subsidies For Urban Public Transport Operators," Proceedings of the INTERNATIONAL MANAGEMENT CONFERENCE, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 11(1), pages 196-210, November.
    • Handle: RePEc:rom:mancon:v:11:y:2017:i:1:p:196-210
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    References listed on IDEAS

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    1. Ian W. H. Parry & Kenneth A. Small, 2009. "Should Urban Transit Subsidies Be Reduced?," American Economic Review, American Economic Association, vol. 99(3), pages 700-724, June.
    2. van Goeverden, Cees & Rietveld, Piet & Koelemeijer, Jorine & Peeters, Paul, 2006. "Subsidies in public transport," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 32, pages 5-25.
    3. Tomás Serebrisky & Andrés Gómez‐Lobo & Nicolás Estupiñán & Ramón Muñoz‐Raskin, 2009. "Affordability and Subsidies in Public Urban Transport: What Do We Mean, What Can Be Done?," Transport Reviews, Taylor & Francis Journals, vol. 29(6), pages 715-739, January.
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