|M.Sc Student||Breidburg Inna|
|Subject||Reforms in Public Transportation|
|Department||Department of Industrial Engineering and Management||Supervisor||PROF. Benjamin Bental|
The ministry of transport
maintains agreements with two cooperatives, Dan and Egged that monopolize
services in their respective regions. The thesis critically assesses this
situation. Economies-to- scale arguments have been raised to justify a monopolistic structure in the
industry. However, absent competition, the costs of these monopolies increase.
Accordingly, competition should be introduced to control costs and reduce
On the other hand, public transportation helps reduce the number of private cars.
Therefore, a central question is whether the public transport sector should be privatized, or remain under public ownership.
An important part of the study is the examination of actual data and especially of experiments in transport reforms of other countries such as Britain, Denmark, Sweden, Norway and Greece.
It seems that the reforms were successful in reducing costs and subsidies, but they also caused environmental changes, which were caused by the shift of travelers from public to private transport.
The study introduces a quantitative model to compare the benefit and damage that resulted from the privatization policy adopted in Britain during 10 years.
The benefit resulting from privatization amounts to 1089 million £ and is greater than the damage of 248 million £.
The study attempts to use similar computation for the Israeli case, and concludes that reform in the transport sector in Israel is worthwhile.