Cost - Benefit Analysis of the German High Speed Rail Network

Authors

Martin Dorciak, Lewis & Clark CollegeFollow

Abstract

This study undertakes a cost-benefit analysis of the German railway market looking specifically at the effects of high-speed rail development on railway passenger subsidies. Using OLS regression analysis, I estimate a demand curve for the German railway network at the route level; this is combined with cost curve estimates to yield a required subsidy for rail development assuming a natural monopoly market structure. I find that an increase in demand as a result of the introduction of high-speed rail technology causes a 23.9% decrease in required rail subsidies.

Recommended Citation

Dorciak, Martin (2015) "Cost - Benefit Analysis of the German High Speed Rail Network," Undergraduate Economic Review: Vol. 12: Iss. 1, Article 4.
Available at: https://digitalcommons.iwu.edu/uer/vol12/iss1/4