Classification of bus transit policy variables

Abstract

This paper develops a conceptual model to classify bus transit policy variables based on their effects on the performance levels of the various inputs and total performance measured by the presence or absence of (dis)economies of scale. The four groups of variables identified in the study include those with Strictly positive outcome—these include speed, and the ratio of employer to employee paid benefits. They improve the productivity levels of the inputs which they affect as well as total performance. Mixed effect with positive outcome—local and federal section 3 subsidy availability are the policy variables in this group. Strictly negative outcome—the policy variables in this group are route miles, the ratio of executives, professionals and supervisors, capacity utilization, and the peak base ratio. Mixed effect with negative outcome—those variables in this group are fleet age, state subsidy availability and the number of modes operated. The policy implications of these groups are examined in the paper. In addition, exceptions to the conceptual model have been identified. Two policy variables, the average daily hours of vehicle operation, and federal capital subsidy availability increase the performance of each input and yet reduce total performance. The methodology adopted allows tests of economies to be examined. The results of this test show economies of scale up to 6 million vehicle miles, constant returns to scale between 6 and 12 million vehicle miles and diseconomies of scale thereafter.

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