Implementation of Nationwide Public Transport Smart Card in the Netherlands: Cost-Benefit Analysis

Abstract

In the Netherlands, public transport plays an important role in meeting the public's travel demands. The country's 19 public transport authorities are required by the central government to implement innovative business practices. The primary objectives are to facilitate competition, improve efficiency, and increase ridership. Smart card technology is seen as a means of aiding in the liberalization of the market and providing management information for planning and marketing. The country's major urban and regional transport system operators agreed in November 1998 to work together to develop a national smart card system. The Dutch Transport Ministry commissioned a cost–benefit analysis to guide the development and implementation of the technology nationwide. The study not only examined the overall potential impact but also appraised effects on different stakeholders under various scenarios. In addition, sensitivity analyses were undertaken to enhance the study's robustness. The methodology used provided a consistent and integrated framework allowing the findings to be assessed in a structured manner to facilitate decision making. The results indicated that the project would involve a wide range of socioeconomic advantages and that, overall, benefits would exceed costs.

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