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The impact of regulation on the development of the transportation industry

by:CNS     2021-07-10
The impact of regulation on the development of the transportation industry 2021-06-20 14:16:22 Among the transportation control objectives stipulated by the laws of Western countries, there will generally be promotion of safety, integrity, fairness, meeting public interests and needs, and promoting the development of the transportation industry. , Competition and efficiency, preventing monopoly, serving for national defense, etc., but efficiency does not seem to be the most important work goal of regulatory agencies. Control appears as a substitute for the market. When market failure occurs, control measures replace the market mechanism. At first, it was because people believed that the railway industry was a monopoly, which led to the low efficiency of the market, so the transportation control system first used for railways was designed in the United States to correct it. The regulator’s behavioral approach based on fairness has made it neglect to compare freight rates with transportation opportunity costs, and this comparison should be the basis for economic efficiency. For example, there is a 'long and short distance discrimination' regulation in the US railway regulation, that is, railway companies are prohibited from charging long-distance transportation lower than short-distance transportation. The regulation seems fair, because the transportation cost is indeed related to the transportation distance. Generally speaking, the farther the transportation is, the higher the cost will be. The higher the charges should be, otherwise short-distance customers will be discriminated against. However, in actual transportation, fixed expenses account for a relatively high proportion of railway transportation costs, and each shipment is different in terms of routes, directions, and other transportation conditions. It is difficult to determine that the cost of a certain batch of long-distance transportation is certain. Higher than the cost of another short-distance transportation. In addition, this 'long-distance discrimination' regulation also greatly restricts railway companies from adopting congestion charging or non-subsidy pricing based on actual conditions. The result is that it looks fair, but is essentially economically inefficient. In the freight rate control of road freight, the principle of equality is also the basis for ruling the change of freight rate and formulating new freight rate standards. The regulatory agency mainly protects small transportation companies and remote rural areas from the freight rate. In the control of air passenger transportation, the Civil Aviation Commission of the United States also regards maintaining air services in small and medium cities as its main goal, and believes that it has achieved relative success in the 1960s and 1970s. There are three main ways to achieve this goal: (1) Financial subsidies are given to airports in small and medium cities. ②All airlines are required to open outlying routes at the same time when applying for profitable routes. ③The freight rate structure is conducive to small and medium-sized cities. After the aviation industry was regulated, it also followed the setting of railway freight rates. The formulation of railway freight rates cannot violate the provisions of 'long-distance discrimination'. Its own transportation cost structure does not particularly meet this requirement. However, the proportion of flight costs that vary with distance in air transportation costs is relatively large. Therefore, this requirement is similar to that of air transportation. The price structure is more suitable. In comparison, the aviation industry has not benefited as much from control as road freight, but it still benefits as a whole.Many poorly operated airlines are protected, and pilots also have high salaries.Of course, those with strong competitive ability. The company believes that its profitability is limited, so it hopes to be free from control. Once the deregulation is achieved, the competition within the aviation industry will immediately become fierce, especially due to the higher freight rates of long-distance routes between large cities, and the degree of competition will be even more severe.
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