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Title:

Microeconomic Analysis of the Relationship Between Bus Operators and Drivers in Public Transport Through the Lens of Contract Theory

Accession Number:

01659987

Record Type:

Component

Abstract:

Because of a need for equitable, accessible and efficient transportation systems, different countries have regulated the operation of buses through concession contracts. However, the design of this policy presents several challenges. These inherent design challenges prompted an increased interest in studying incentive schemes faced by system operators, resulting in considerable changes in concession contracts, and consequent improvements in service. However, the literature has not explored the payment structures of the system's drivers. Given drivers' importance to a public transit system's operation, there is a need to study the incentives they face, in order to recommend improvements that will increase quality of service. In this paper, the behavior of the drivers is modeled. Special emphasis is placed on the Principal-Agent relationship, the effects of multitasking, and risk aversion in the face of variable wage rates. The authors conclude that in conditions that are suboptimal in encouraging drivers to expend effort in transporting passengers or completing routes, service can be improve by offering drivers individual, performance-based bonuses. The authors also demonstrate that variance in a drivers' duties or in the results observed by the operator, in addition with fatigue and stress, will result in a reduction of efforts made by drivers.

Supplemental Notes:

This paper was sponsored by TRB committee AP010 Standing Committee on Transit Management and Performance.

Report/Paper Numbers:

18-05383

Language:

English

Authors:

de la Vega, José Miguel
Galilea, Patricia

Pagination:

27p

Publication Date:

2018

Conference:

Transportation Research Board 97th Annual Meeting

Location: Washington DC, United States
Date: 2018-1-7 to 2018-1-11
Sponsors: Transportation Research Board

Media Type:

Digital/other

Features:

Figures; References

Subject Areas:

Administration and Management; Economics; Operations and Traffic Management; Public Transportation

Source Data:

Transportation Research Board Annual Meeting 2018 Paper #18-05383

Files:

TRIS, TRB, ATRI

Created Date:

Jan 8 2018 11:22AM