Standard costs of regional public rail passenger transport: evidence from Italy

ABSTRACT

The paper estimates the standard cost in Italian regional public rail passenger transport services (LPTR), depending on service characteristics. The results highlight the crucial role of: number of seats per ride, commercial speed, service size and length of rail tracks. The model also shows the positive link between investment in rolling stock and the unit cost of the service. Finally, based on the empirical evidence, we propose regulatory adjustments to accomplish policy targets regarding the fair allocation of public LPTR funds to Regions and Local Authorities and a more efficient use of (scarce) local and national public resources.