The economic rationale for integrated tariffs in local public transport | Zendy

Carla Marchese | Zendy

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The economic rationale for integrated tariffs in local public transport

Author(s) -

Carla Marchese

Publication year - 2006

Publication title -

the annals of regional science

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 0.722

H-Index - 62

eISSN - 1432-0592

pISSN - 0570-1864

DOI - 10.1007/s00168-005-0045-3

Subject(s) - nonlinear pricing , economic surplus , microeconomics , willingness to pay , economics , public transport , estimation , business , industrial organization , public economics , transport engineering , engineering , market economy , welfare , management

In this paper, it is shown that integrated tariffs can be used to extract the consumer’s surplus when there are a lot of connections supplied so that the law of large numbers applies in the estimation of the consumer’s willingness to pay. The time validity limitations of tickets are explained by a nonlinear pricing approach. Links between optimal pricing in local public transport and network characteristics are highlighted.

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