“Bidding for urban public transport: an econometric analysis of French competitive trends”
Emmanuel Frot (Microeconomix, Stockholm School of Economics), François Lévêque (Ecole des Mines), Gildas de Muizon (Microeconomix), Emile Quinet (Paris School of Economics)
Abstract: Urban public transport services are delivered in France through the use of competitive tenderings, with firms participating in city-specific auctions. The market has been formerly described, based on pre-2005 data, as a failure of liberalization, with a large incumbency bias and with little competition. This paper studies the recent trends in competition on this market by using a detailed database at the firm level. We find that, after 2005, competition significantly strengthened, with auctions attracting more bids and a decreasing rate of renewal for incumbents. In addition to this market overview, we study the determinants of participation and success in auctions.