Estimation of Demand Functions for Services of Public Railway Passenger Transportation: Evidence from Slovenia

  • Jani Beko
Keywords: price elasticity of demand, income elasticity of demand, price policy,

Abstract

The paper deals with the estimation of demand functionsfor services of public railway passenger transportation in thecase of Slovenia. Six demand functions were selected and separatelyinterpreted. The aggregate values of demand elasticitiesreported in this paper suggest that the railway passenger demandis price- and income-inelastic. Coefficients of incomeelasticity below one show that the services of railway passengertransportation in Slovenia can be classified among normalgoods. A hypothetical increase in average real fares leads to apercentage decrease in the number of passengers traveling byrail that is smaller than the percentage increase in fares. The estimatedprice elasticities imply that, in the short run, there is potentialfor improving revenues of the railway operator by increasingaverage real fares.

References

G. de Rus: Public Transport Demand Elasticities in Spain,

Journal of Transport Economics and Policy, Vol. 24,

, pp. 189-201.

P. B. Goodwin: A Review of New Demand Elasticities

with Special Reference to Short and Long Run Effects of

Price Changes, International Journal of Transport Economics,

Vol. 26, 1992, pp. 155-169.

J. Luk and S. Hepburn: New Review of Australian Travel

Demand Elasticities, Australian Road Research Board

Ltd Research ReportARR 249, 1993.

W. Nicholson: Microeconomic Theory. Basic Principles

and Extensions. Philadelphia, The Dryden Press, 1995.

T. H. Oum: Alternative Demand Models and Their Elasticity

Estimates, Journal of Transport Economics and

Policy, Vol. 23, 1989, pp. 163-187.

T. H. Oum and W. G. Watters 11: Transport Demand

Elasticities. In Handbook of Transport Modelling, editors

D. A. Hensher, K. J. Button. Amsterdam, Pergamon,

, pp. 197-210.

T. H. Oum, W. G. Watters 11 and Y. Jong-Say: Concepts

of Price Elasticities of Transport Demand and Recent

Empirical Estimates. An Interpretative Survey, Journal of

Transport Economics and Policy, Vol. 26, 1992, pp. 139-

·154.

A. D. Owen and G. D. A. Phillips: The Characteristics of

Railway Passenger Demand. An Econometric Investigation,

Journal of Transport Economics and Policy, Vol.

, 1987, pp. 231-253.

M. Wardman, J. P. Toner, and A. W. Gerard: Interactions

between Rail and Car in the Inter-Urban Leisure

Travel Market in Great Britain, Journal of Transport

Economics and Policy, Vol. 31, 1997, pp.163-181.

How to Cite
1.
Beko J. Estimation of Demand Functions for Services of Public Railway Passenger Transportation: Evidence from Slovenia. PROMET [Internet]. 1 [cited 2020Apr.4];16(1):5-14. Available from: http://traffic.fpz.hr/index.php/PROMTT/article/view/567
Section
Older issues