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Transport economics

Transport economics is a cross-disciplinary study linking civil engineering and economics. Transport economics differs from some other branches of economics in that the assumption of a spaceless, instantaneous economy does not hold. People and goods flow over networks at certain speeds. Demands peak. Advanced ticket purchase is often induced by lower fares. The networks themselves may or may not be competitive. A single trip (the final good from the point-of-view of the consumer) may require bundling the services provided by several firms, agencies and modes.

One difficulty is the valuation of time, time is valued differently in different societies and also by different strata in the same society. Higher speeds in any mode are often justified by the time drivers or passengers can be expected to save, but these traveller flows have to be estimated with some confidence ahead of the provision of the faster - or more frequent - service. Added speed will have implications for both the design of the vehicle and the infrastructure it needs on the ground, but it might negatively impact energy efficiency, safety and perhaps elements of the environment through which it passes. The valuation of time and the identification of trends in that valuation are therefore key factors in assessing whether investments in transport facilities are economically worthwhile. The geographic, environmental and social impacts of changed transport networks have been much better appreciated since 1975, in particular an awareness that enlarged network capacity actually generates trips that would not otherwise have been made has grown. See Smart growth. The provision of an upgraded transport network usually requires a disruption of the present network for months or even years, whether that upgrade is stimulated either by wear-and-tear, safety considerations, land-use change or a decision to uprate capacity. In some cities, especially in Europe, the redistribution of roadspace in favour of pedestrians, buses, trams or cycles has reversed the historic tendency for the faster modes to prevail. Some historic networks, such as canals or rural railways have even been restored as heritage attractions, following generations of neglect. Such re-opened facilities usually aim to attract nostalgic tourists as well as to perform a limited transport function.

The regulation of public transport is often designed to achieve some social, geographic and temporal equity as market forces might otherwise lead to services being limited to the most popular travel times along the most densely settled corridors of development. State, regional or municipal taxes are often deployed to extend timetables through the daytime, weekend, holiday or evening periods and to intensify the mesh of routes above that which a lightly regulated market would probably provide. Franchising may be used to strike a balance between frugal operations and a socially acceptable array of services supportive of an area's economic life. Agile people able to buy private transport facilities often resent paying taxes to support transit options for their fellow citizens.

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