Scandinavian Working Papers in Economics

Working papers in Transport Economics,
CTS - Centre for Transport Studies Stockholm (KTH and VTI)

No 2016:27: Estimating the marginal maintenance cost of rail infrastructure usage in Sweden; does more data make a difference?

Kristofer Odolinski () and Jan-Eric Nilsson ()
Additional contact information
Kristofer Odolinski: VTI, Postal: Centrum för Transportstudier (CTS), Teknikringen 10, 100 44 Stockholm, Sweden
Jan-Eric Nilsson: VTI, Postal: Centrum för Transportstudier (CTS), Teknikringen 10, 100 44 Stockholm, Sweden

Abstract: This paper updates knowledge about the marginal cost of railway maintenance. Using a panel dataset comprising 16 years, we test whether more data makes a difference to conclusions. In contrast to previous estimates using a shorter panel, maintenance costs are now demonstrated to exhibit a positive dynamic effect; an increase in maintenance cost during one year indicates the need for more maintenance also the next year. Moreover, the marginal cost from the dynamic model is larger than its static counterpart. We conclude that the use of dynamic models on longer time series may have charging implications in several EU member states, considering that their track access charges are based on econometric studies that use static models and short panel datasets.

Keywords: Marginal cost; Rail infrastructure; Maintenance; Dynamic model; Track access charges

JEL-codes: L92; R48

10 pages, First version: December 9, 2016. Revised: May 13, 2017. Earlier revisions: April 5, 2017, May 13, 2017.

Note: Published in Economics of Transportation, Volume 10, June 2017, Pages 8-17.

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j.ecotra.2017.05.001 PDF-file Full text

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