The Economics of EU Railway Reform. Bruges European Economic Policy (BEEP) Briefing 8/2004

The EU began railway reform in earnest around the turn of the century. Two ‘railway packages’ have meanwhile been adopted amounting to a series of directives and a third package has been proposed. A range of complementary initiatives has been undertaken or is underway. This BEEP Briefing inspects the main economic aspects of EU rail reform. After highlighting the dramatic loss of market share of rail since the 1960s, the case for reform is argued to rest on three arguments: the need for greater competitiveness of rail, promoting the (market driven) diversion of road haulage to rail as a step towards sustainable mobility in Europe, and an end to the disproportional claims on public budgets of Member States. The core of the paper deals respectively with market failures in rail and in the internal market for rail services; the complex economic issues underlying vertical separation (unbundling) and pricing options; and the methods, potential and problems of introducing competition in rail freight and in passenger services. Market failures in the rail sector are several (natural monopoly, economies of density, safety and asymmetries of information), exacerbated by no less than 7 technical and legal barriers precluding the practical operation of an internal rail market. The EU choice to opt for vertical unbundling (with benefits similar in nature as in other network industries e.g. preventing opaque cross-subsidisation and greater cost revelation) risks the emergence of considerable coordination costs. The adoption of marginal cost pricing is problematic on economic grounds (drawbacks include arbitrary cost allocation rules in the presence of large economies of scope and relatively large common costs; a non-optimal incentive system, holding back the growth of freight services; possibly anti-competitive effects of two-part tariffs). Without further detailed harmonisation, it may also lead to many different systems in Member States, causing even greater distortions. Insofar as freight could develop into a competitive market, a combination of Ramsey pricing (given the incentive for service providers to keep market share) and price ceilings based on stand-alone costs might be superior in terms of competition, market growth and regulatory oversight. The incipient cooperative approach for path coordination and allocation is welcome but likely to be seriously insufficient. The arguments to introduce competition, notably in freight, are valuable and many e.g. optimal cross-border services, quality differentiation as well as general quality improvement, larger scale for cost recovery and a decrease of rent seeking. Nevertheless, it is not correct to argue for the introduction of competition in rail tout court. It depends on the size of the market and on removing a host of barriers; it requires careful PSO definition and costing; also, coordination failures ought to be pre-empted. On the other hand, reform and competition cannot and should not be assessed in a static perspective. Conduct and cost structures will change with reform. Infrastructure and investment in technology are known to generate enormous potential for cost savings, especially when coupled with the EU interoperability programme. All this dynamism may well help to induce entry and further enlarge the (net) welfare gains from EU railway reform. The paper ends with a few pointers for the way forward in EU rail reform.

What prospects for transport infrastructure and impacts on growth in southern and eastern Mediterranean countries? MEDPRO Report No. 3, February 2013

Lack of adequate infrastructure is a significant inhibitor to increased trade of the countries of the Mediterranean region. Bringing their transport infrastructure to standards comparable with countries of a similar per capita GDP will be costly but worthwhile. We compare the current quantities of six types of transport infrastructure with international benchmarks, and estimate the additional quantities needed to reach the benchmarks. We also estimate the cost of that infrastructure and express it as a percentage of GDP. Finally we make tentative estimates of how much trade might be generated and how this might impact on GDP. All the estimates are made for 11 southern and eastern Mediterranean countries (SEMCs) under four scenarios. The greatest need for additional infrastructure is for airport passenger terminals (between 52% and 56%), whereas the least is for more unpaved roads (between 7% and 13%). The investment (including maintenance) cost would be between 0.9% of GDP and 2.4% of GDP, although the investments in some countries would be between 1.4% and 4.5% of GDP. The impact on non-oil international trade would be substantial, but with differences between imports and exports. The overall trade balance of the 11 countries would be an improvement of between 5.4% and 17.2%, although some countries would continue to have a negative balance. A final assessment is made of the benefit ratio between the increase in GDP and the cost of transport investment. This varies between about 3 and 8, an indication of the high return to be expected from increased investment in transport infrastructure.

The EU regime on biofuels in transport: Still in search of sustainability. Egmont Paper No. 68, July 2014

Like other regions of the world, the EU is developing biofuels in the transport sector to reduce oil consumption and mitigate climate change. To promote them, it has adopted favourable legislation since the 2000s. In 2009 it even decided to oblige each Member State to ensure that by 2020 the share of energy coming from renewable sources reached at least 10% of their final consumption of energy in the transport sector. Biofuels are considered the main instrument to reach that percentage since the development of other alternatives (such as hydrogen and electricity) will take much longer than expected. Meanwhile, these various legislative initiatives have driven the production and consumption of biofuels in the EU. Biofuels accounted for 4.7% of EU transport fuel consumption in 2011. They have also led to trade and investment in biofuels on a global scale. This large-scale expansion of biofuels has, however, revealed numerous negative impacts. These stem from the fact that first-generation biofuels (i.e., those produced from food crops), of which the most important types are biodiesel and bioethanol, are used almost exclusively to meet the EU’s renewable 10% target in transport. Their negative impacts are: socioeconomic (food price rises), legal (land-grabbing), environmental (for instance, water stress and water pollution; soil erosion; reduction of biodiversity), climatic (direct and indirect land-use effects resulting in more greenhouse gas emissions) and public finance issues (subsidies and tax relief). The extent of such negative impacts depends on how biofuel feedstocks are produced and processed, the scale of production, and in particular, how they influence direct land use change (DLUC) and indirect land use change (ILUC) and the international trade. These negative impacts have thus provoked mounting debates in recent years, with a particular focus on ILUC. They have forced the EU to re-examine how it deals with biofuels and submit amendments to update its legislation. So far, the EU legislation foresees that only sustainable biofuels (produced in the EU or imported) can be used to meet the 10% target and receive public support; and to that end, mandatory sustainability criteria have been defined. Yet they have a huge flaw. Their measurement of greenhouse gas savings from biofuels does not take into account greenhouse gas emissions resulting from ILUC, which represent a major problem. The Energy Council of June 2014 agreed to set a limit on the extent to which firstgeneration biofuels can count towards the 10% target. But this limit appears to be less stringent than the ones made previously by the European Commission and the European Parliament. It also agreed to introduce incentives for the use of advanced (second- and third-generation) biofuels which would be allowed to count double towards the 10% target. But this again appears extremely modest by comparison with what was previously proposed. Finally, the approach chosen to take into account the greenhouse gas emissions due to ILUC appears more than cautious. The Energy Council agreed that the European Commission will carry out a reporting of ILUC emissions by using provisional estimated factors. A review clause will permit the later adjustment of these ILUC factors. With such legislative orientations made by the Energy Council, one cannot consider yet that there is a major shift in the EU biofuels policy. Bolder changes would have probably meant risking the collapse of the high-emission conventional biodiesel industry which currently makes up the majority of Europe’s biofuel production. The interests of EU farmers would have also been affected. There is nevertheless a tension between these legislative orientations and the new Commission’s proposals beyond 2020. In any case, many uncertainties remain on this issue. As long as solutions have not been found to minimize the important collateral damages provoked by the first generation biofuels, more scientific studies and caution are needed. Meanwhile, it would be wise to improve alternative paths towards a sustainable transport sector, i.e., stringent emission and energy standards for all vehicles, better public transport systems, automobiles that run on renewable energy other than biofuels, or other alternatives beyond the present imagination.

Towards an Effective EU Framework for Road Transport and GHG Emissions. CEPS Special Report No. 141 / July 2016

The adoption of the Paris Agreement at the end of 2015 and the EU’s intended nationally determined contribution (INDC) have confirmed the EU’s commitment to achieve decarbonisation by 2050. Transport accounts for about a quarter of EU greenhouse gas (GHG) emissions, representing the second-largest source of GHG emissions in Europe after the energy sector. The transport sector will play a significant role in the EU’s efforts to decarbonise its economy in line with its international commitments. The purpose of this report is to examine different EU policy options to address transport emissions, with a special emphasis on passenger cars. It ‘thinks through’ the options that are currently assessed in the EU and considers how they could be put together in a comprehensive framework. The report concludes with a number of measures to lead EU transport decarbonisation policy. A distinction is made between i) no-regret options and ii) measures for consideration.

Perceived Accessibility of Public Transport as a Potential Indicator of Social Inclusion

Perceived accessibility has been acknowledged as an important aspect of transport policy since the 70s. Nevertheless, very few empirical studies have been conducted in this field. When aiming to improve social inclusion, by making sus-tainable transport modes accessible to all, it is important to understand the factors driving perceived accessibility. Un-like conventional accessibility measures, perceived accessibility focuses on the perceived possibilities and ease of en-gaging in preferred activities using different transport modes. We define perceived accessibility in terms of how easy it is to live a satisfactory life with the help of the transport system, which is not necessarily the same thing as the objec-tive standard of the system. According to previous research, perceived accessibility varies with the subjectively-rated quality of the mode of transport. Thus, improvements in quality (e.g. trip planning, comfort, or safety) increase the per-ceived accessibility and make life easier to live using the chosen mode of transport. This study (n=750) focuses on the perceived accessibility of public transport, captured using the Perceived Accessibility Scale PAC (Lättman, Olsson, & Fri-man, 2015). More specifically, this study aims to determine how level of quality affects the perceived accessibility in public transport. A Conditional Process Model shows that, in addition to quality, feeling safe and frequency of travel are important predictors of perceived accessibility. Furthermore, elderly and those in their thirties report a lower level of perceived accessibility to their day-to-day activities using public transport. The basic premise of this study is that sub-jective experiences may be as important as objective indicators when planning and designing for socially inclusive transport systems.

Incorporating an economic model in the health impact assessment approach

The current policy decision making in Australia regarding non-health public investments (for example, transport/housing/social welfare programmes) does not quantify health benefits and costs systematically. To address this knowledge gap, this study proposes an economic model for quantifying health impacts of public policies in terms of dollar value. The intention is to enable policy-makers in conducting economic evaluation of health effects of non-health policies and in implementing policies those reduce health inequalities as well as enhance positive health gains of the target population. Health Impact Assessment (HIA) provides an appropriate framework for this study since HIA assesses the beneficial and adverse effects of a programme/policy on public health and on health inequalities through the distribution of those effects. However, HIA usually tries to influence the decision making process using its scientific findings, mostly epidemiological and toxicological evidence. In reality, this evidence can not establish causal links between policy and health impacts since it can not explain how an individual or a community reacts to changing circumstances. The proposed economic model addresses this health-policy linkage using a consumer choice approach that can explain changes in group and individual behaviour in a given economic set up. The economic model suggested in this paper links epidemiological findings with economic analysis to estimate the health costs and benefits of public investment policies. That is, estimating dollar impacts when health status of the exposed population group changes by public programmes – for example, transport initiatives to reduce congestion by building new roads/ highways/ tunnels etc. or by imposing congestion taxes. For policy evaluation purposes, the model is incorporated in the HIA framework by establishing association among identified factors, which drive changes in the behaviour of target population group and in turn, in the health outcomes. The economic variables identified to estimate the health inequality and health costs are levels of income, unemployment, education, age groups, disadvantaged population groups, mortality/morbidity etc. However, though the model validation using case studies and/or available database from Australian non-health policy (say, transport) arena is in the future tasks agenda, it is beyond the scope of this current paper.

Conceptualising convenience : transportation practices and perceptions of inner-urban high density residents in Brisbane, Australia

High-density living in inner-urban areas has been promoted to encourage the use of more sustainable modes of travel to reduce greenhouse gas emissions. However, previous research presents mixed results on the relationship between living in proximity to transport systems and reduced car-dependency. This research examines inner-city residents’ transportation practices and perceptions, via 24 qualitative interviews with residents from high-density dwellings in inner-city Brisbane, Australia. Whilst participants consider public transport accessible and convenient, car use continues to be relied on for many journeys. Transportation choices are justified through complex definitions of convenience containing both utilitarian and psycho-social elements,with three key themes identified: time-efficiency, single versus multi-modal trips, and distance to and purpose of journey, as well as attitudinal, affective and symbolic elements related to transport mode use. Understanding conceptions of transport convenience held by different segments of the transport users market,alongside other factors strongly implicated in travel mode choice, can ensure targeted improvements in sustainable transport service levels and infrastructure as well as information service provision and behavioural change campaigns.

From barrier elimination to barrier negotiation : a qualitative study of parents' attitudes about active travel for elementary school trips

This paper examines parents' responses to key factors associated with mode choices for school trips. The research was conducted with parents of elementary school students in Denver Colorado as part of a larger investigation of school travel. School-based active travel programs aim to encourage students to walk or bike to school more frequently. To that end, planning research has identified an array of factors associated with parents' decisions to drive children to school. Many findings are interpreted as ‘barriers’ to active travel, implying that parents have similar objectives with respect to travel mode choices and that parents respond similarly and consistently to external conditions. While the conclusions are appropriate in forecasting demand and mode share with large populations, they are generally too coarse for programs that aim to influence travel behavior with individuals and small groups. This research uses content analysis of interview transcripts to examine the contexts of factors associated with parents' mode choices for trips to and from elementary school. Short, semi-structured interviews were conducted with 65 parents from 12 Denver Public Elementary Schools that had been selected to receive 2007–08 Safe Routes to School non-infrastructure grants. Transcripts were analyzed using Nvivo 8.0 to find out how parents respond to selected factors that are often described in planning literature as ‘barriers’ to active travel. Two contrasting themes emerged from the analysis: barrier elimination and barrier negotiation. Regular active travel appears to diminish parents' perceptions of barriers so that negotiation becomes second nature. Findings from this study suggest that intervention should build capacity and inclination in order to increase rates of active travel.

Effects of Mobile Phone Distraction at the Onset of Amber Light: Analysis of Driving Simulator Data

Distraction whilst driving on an approach to a signalized intersection is particularly dangerous, as potential vehicular conflicts and resulting angle collisions tend to be severe. This study examines the decisions of distracted drivers during the onset of amber lights. Driving simulator data were obtained from a sample of 58 drivers under baseline and handheld mobile phone conditions at the University of IOWA - National Advanced Driving Simulator. Explanatory variables include age, gender, cell phone use, distance to stop-line, and speed. An iterative combination of decision tree and logistic regression analyses are employed to identify main effects, non-linearities, and interactions effects. Results show that novice (16-17 years) and younger (18-25 years) drivers’ had heightened amber light running risk while distracted by cell phone, and speed and distance thresholds yielded significant interaction effects. Driver experience captured by age has a multiplicative effect with distraction, making the combined effect of being inexperienced and distracted particularly risky. Solutions are needed to combat the use of mobile phones whilst driving.

Remote, rural, and regional airports in Australia

This paper provides an overview of the challenges faced by remote, rural and regional airports in Australia. The deregulation of airports over the past decades has resulted in local councils owning most of the rural and regional airports across Australia. The paper provides an overview of the international literature on regional airports and research directed at defining the issues faced by regional and rural airports in Australia. A survey of airport managers, regulators and local councils was undertaken across Australia to outline the challenges and stresses that regional airports are facing. Core findings indicate that the operation of rural and regional airports is under stress due to the interrelating factors of infrastructure costs, high cost of maintenance, and security infrastructure upgrades. Small airports often compete with one another to attract airlines and maintain their infrastructure advantage.

Commercial vehicle pre-clearance programs : current issues and recommendations for potential implementation

The regulation of overweight trucks is of increasing importance. Quickly growing heavy vehicle volumes over-proportionally contribute to roadway damage. Raising maintenance costs and compromised road safety are also becoming a major concern to managing agencies. Minimizing pavement wear is done by regulating overloaded trucks on major highways at weigh stations. However, due to lengthy inspections and insufficient capacities, weigh stations tend to be inefficient. New practices, using Radio Frequency Identification (RFID) transponders and weigh-in-motion technologies, called preclearance programs, have been set up in a number of countries. The primary aim of this study is to investigate the current issues with regard to the implementation and operation of the preclearance program. The State of Queensland, Australia, is used as a case study. The investigation focuses on three aspects; the first emphasizes on identifying the need for improvement of the current regulation programs in Queensland. Second, the operators of existing preclearance programs are interviewed for their lessons-learned and the marketing strategies used for promoting their programs. The trucking companies in Queensland are interviewed for their experiences with the current weighing practices and attitudes toward the potential preclearance system. Finally, the estimated benefit of the preclearance program deployment in Queensland is analyzed. The penultimate part brings the former four parts together and provides the study findings and recommendations. The framework and study findings could be valuable inputs for other roadway agencies considering a similar preclearance program or looking to promote their existing ones.

Productivity growth and biased technological change in Japanese airports

In this paper, the productivities of Japanese airports over the period of 1987-2005 are analyzed using the Malmquist index, and technological bias is investigated. During this period, airports on average became less efficient and experienced technological regress. Our results indicate that the traditional growth accounting method, which assumes Hicks neutral technological change, is not appropriate for analyzing changes in productivity for Japanese airports.

Disability due to road traffic crashes and the management of road safety in developing countries

Injury as a result of road traffic crashes is one of the most significant public health problems in developing countries. It intersects with disability as a development issue because a substantial proportion of people injured in road traffic crashes experience disability, both short term and long term. While there have been significant steps towards better management of road safety globally, especially in developing countries, the implications for road safety policy and practice of disability due road traffic crashes is not fully appreciated. In particular, qualitative information on the lived experience people with a long term disability as a result of a road traffic crash can inform better road safety policy and practice, as demonstrated in a case study from Thailand. The benefits of better policies and practices are likely to accrue to a wide range of road users, and to contribute to the achievement of sustainable development.

Commuting mode choice in transit oriented development: Disentangling the effects of competitive neighbourhoods, travel attitudes, and self-selection

This research identifies the commuting mode choice behaviour of 3537 adults living in different types of transit oriented development (TOD) in Brisbane by disentangling the effects of their “evil twin” transit adjacent developments (TADs), and by also controlling for residential self-selection, travel attitudes and preferences, and socio-demographic effects. A TwoStep cluster analysis was conducted to identify the natural groupings of respondents’ living environment based on six built environment indicators. The analysis resulted in five types of neighbourhoods: urban TODs, activity centre TODs, potential TODs, TADs, and traditional suburbs. HABITAT survey data were used to derive the commute mode choice behaviour of people living in these neighbourhoods. In addition, statements reflecting both respondents’ travel attitudes and living preferences were also collected as part of the survey. Factor analyses were conducted based on these statements and these derived factors were then used to control for residential self-selection. Four binary logistic regression models were estimated, one for each of the travel modes used (e.g. public transport, active transport, less sustainable transport such as the car/taxi, and other), to differentiate between the commuting behaviour of people living in the five types of neighbourhoods. The findings verify that urban TODs enhance the use of public transport and reduce car usage. No significant difference was found in the commuting behaviour between respondents living in traditional suburbs and TADs. The results confirm the hypothesis that TADs are the “evil twin” of TODs. The data indicates that TADs and the mode choices of residents in these neighbourhoods is a missed transport policy opportunity. Further policy efforts are required for a successive transition of TADs into TODs in order to realise the full benefits of these. TOD policy should also be integrated with context specific TOD design principles.