Competition in long distance transport: Impacts on prices, frequencies, and demand in the Czech Republic

Fitzová, Hana; Kališ, Richard; Pařil, Vilém; Kasa, Marek

doi:10.1016/j.rtbm.2021.100655

Cited by 8 publications

(3 citation statements)

References 35 publications

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“…This war led to a sudden reduction of 42% of prices, that together with the doubling of passengers made a +10% overall revenues (Tomeš & Jandová, 2018; Chini et al, 2021). However, no price elasticity is found in the country, whatever is the state of competition (Fitzová et al, 2021). A similar price war occurred in Slovakia, where the incumbent compensated regional trains subtracted passengers and revenues to RegioJet (Kvizda & Solnička, 2019).…”

Section: Open-access Competition In Europe and Focus On Pricesmentioning

confidence: 99%

A Difference-In-Difference Approach to Estimate the Price Effect of Market Entry in High-Speed Rail

Beria

Tolentino

Shtele

et al. 2022

Competition and Regulation in Network Industries

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The effect of competition on prices in the passenger transport sector can be difficult to estimate because of many influencing factors such as state regulation, demand, seasonality, and reactions of indirect competitors. A case of great interest in the rail sector is Italy, where on-track competition in the high-speed segment has been in place for nearly ten years. The paper aims at answering the question whether—and how much—incumbent’s prices are affected when competition starts on a route previously in monopoly. The case is the start of operations on the Turin–Milan–Venice route, where Italo entered in May 2018. Adopting a difference-in-difference approach, we check if Trenitalia changed the price strategy on the route before and after the entry, with respect to two control groups. The addition of placebo tests allows us to understand the ranges of significance of the results and to estimate the noise level of the estimates. Our findings suggest that the start of competition led to lower prices in the short-medium period. In the specific case, the Milano–Venezia route saw Trenitalia’s prices reduced by 21–26% (±2–5%) in a time span of 84–140 days after Italo’s entry and for advanced bookings from 2 to 10 days. Last-day prices remain unchanged, while early bookings are reduced by just 9%. This price reduction does not remain stable in the longer term, when other effects add up and blur the effect of the entry. Nevertheless, we keep observing a smaller, ∼15%, but still negative prices change.

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Section: Open-access Competition In Europe and Focus On Pricesmentioning

confidence: 99%

A Difference-In-Difference Approach to Estimate the Price Effect of Market Entry in High-Speed Rail

Beria

Tolentino

Shtele

et al. 2022

Competition and Regulation in Network Industries

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“…Leo Express entered the line in January 2013 using five new Stadler suburban electric multiple units utilised for long-distance service. At present, there is a situation in which three railway undertakings compete on the same line (for further details about the competition on the Prague-Ostrava line, see Tomeš et al, 2014; Tomeš et al, 2016 and Tomeš & Jandová, 2018; Fitzová et al, 2021).…”

Section: Industry Backgroundmentioning

confidence: 99%

What is the real power of incumbents? Case study on the Czech Republic

Chini

Kvizda

Špetík

2023

Competition and Regulation in Network Industries

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After an introduction of competition due to liberalisation, there is an expectation of lower prices and better quality. However, these overall positive effects could be also driven by the incumbent’s incentive to exclude competition within the liberalised markets. Such a situation occurred on the Prague-Ostrava line where liberalisation brought lower prices and an increase in quality. However, it also brought multiple accusations by both the Czech competition authority and the European Commission of the state-owned incumbent, České dráhy, that it had engaged in predatory pricing. This paper then assesses whether the price decreases within this line were driven by actual competition or by predatory behaviour of České dráhy by analysing the position of České dráhy. The aim of this paper therefore is to assess the real market power of the Czech state incumbent, České dráhy, on the Prague-Ostrava line. To achieve this aim, we used unique data we had gathered from our previous research (such as price development, market shares and customer behaviour). Our results then show that it is unlikely that České dráhy could have acted independently of its competitors and customers, which indicates that it could not have had a dominant position.

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“…Others case studies were developed by Tomeš and Fitzová (2019), who focused on the advantages of open access passenger rail competition on the Prague -Brno line. Research on public tenders, competition, and liberalisation of railway markets in the Czech Republic was conducted by Fitzová et al (2021), Seidenglanz et al (2014), andTomeš et al (2014). Bulíček (2018) proposed methodology of timetable synchronization in urban public transport at busy hubs of long-distance transport.…”

Section: Introductionmentioning

confidence: 99%

Technological Aspects of Tendering in Rail Passenger Transport in Slovakia

Bulková

Gašparík²,

Poliak³

et al. 2023

Period. Polytech. Transp. Eng.

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The market for rail services in EU countries has long been inaccessible to the private sector. Transport services were provided by national operators, which led to the prevention of participation in fair and non-discriminatory competition in the provision of rail transport services. It is necessary to analyse the overall development in the operation of rail passenger transport, including the entry of private operators into the rail infrastructure. Based on the knowledge of the current situation, it is necessary to take measures to achieve compliance with the requirements of Regulation (EC) No 1370/2007. The paper characterizes the current state and the process of organizing public tenders in the Slovak Republic based on a case study and their process and proposes the gradual steps of the public tender in the form of a schedule. An important point of the whole process of the organization of the public tender is the correct setting of competencies, determination of the subject of the public tender and to propose a uniform methodology of the public tender, which may, however, vary in individual states due to the conditions of national legislation. Part of the unified methodology is the determination of the phases of the public tender process, which are part of the schedule of the public tender. The schedule of the public tender shows the entire cycle, resp. the duration of each phase of the tender for each proposed group of measures taken.

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Competition in long distance transport: Impacts on prices, frequencies, and demand in the Czech Republic

Cited by 8 publications

References 35 publications

A Difference-In-Difference Approach to Estimate the Price Effect of Market Entry in High-Speed Rail

A Difference-In-Difference Approach to Estimate the Price Effect of Market Entry in High-Speed Rail

What is the real power of incumbents? Case study on the Czech Republic

Technological Aspects of Tendering in Rail Passenger Transport in Slovakia

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