Deregulation and the determinants of network access : evidence from the German interurban bus industry

Dürr, Niklas S. ; Hüschelrath, Kai

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URN: urn:nbn:de:bsz:180-madoc-414040
Document Type: Working paper
Year of publication: 2016
The title of a journal, publication series: ZEW Discussion Papers
Volume: 16-054
Place of publication: Mannheim
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: L92 , L11 , L20 , C41 , M20 , R41,
Keywords (English): Deregulation , entry , industry dynamics , interurban buses , survival analysis
Abstract: Two years after the deregulation of the German interurban bus industry in January 2013, two new entrants emerged as market leaders: MeinFernbus (MFB) and FlixBus (FB). We use a comprehensive route-level data set to investigate the determinants of route entry for both providers. Applying survival models, we find that both companies show an increased probability to enter populous, centrally located routes with large shares of young inhabitants; however, they both avoid entries into routes including an airport or with low quality rail connection. Furthermore, both market leaders refrain from entering small and medium-sized routes in which another provider is already operating. In large markets, however, they both show an increased entry probability independent of the presence of a competitor.

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