Transport Institutions in the Policy Process
Transport policies are needed to guarantee efficient transportation systems that satisfy the mobility needs of people and firms and with a minimum cost and harm to the society and environment. Clearly this would not be possible without public effort. Compared to many other markets, in the transport sector there are significant market failures such as increasing returns to scale, non-price taking behaviour, external effects, public goods, and imperfect information. While the case for government action regulating and providing services is clear, in practice government behaviour, rather than promoting common economic wealth (welfare) through a rational decision-making process, often seems to result in inconsistent policies and even government failure. Much academic research has been conducted to increase our understanding of these issues. However, the focus of policy-oriented research and discussion of transport policies has predominantly been on what should be done, rather than on what can be done or what will be done. Some projects e.g. AFFORD and MC-ICAM have begun investigating these issues in relation to transport pricing. STELLA is an ongoing review project (Thematic Network), which addresses institutional issues. The fact that the actual implementation of certain transport policies in practice – pricing policies being the most notable example – has appeared to be problematic or simply failed is in many cases understood to be due to the fact that the existing government institutions and organisations either are inappropriate or ineffective for carrying out the optimal policies or may even themselves impose barriers or constraints on the implementation.
The TIPP project examines these and other similar implementation or formulation problems and suggests ways of overcoming them.
The overall objective was to describe how institutional arrangements and interactions affect the implementation of transport policies.
The project covered all levels of policy-making from local/regional to national and the EU, as well as interactions between these. The objective was not to assess transport policies themselves (in a normative sense), but to analyse how institutional settings contribute to the effective implementation of the policies and the achievement of policy goals.
Although TIPP focused on the positive analysis, ultimately its aim was to produce results that would help to develop better policies in a normative sense: how should institutional settings be arranged in different situations so that (the implementation of) policies would be effective and welfare maximising
Specific objectives of the TIPP project were:
- to provide a comprehensive picture of institutional framework conditions (constraints and enablers) for implementing transport policies throughout Europe;
- to develop an approach for studying the range of institutional implementation issues covered, by combining elements from different fields such as the positive theories of regulation, public choice, economic theory of federalism, institutional economics (new and old), political science, sociological approaches/theories, and modern theory of cognitive psychology;
- to derive results (theoretical and empirical) regarding the implications and impacts of different organisational and regulatory constraints and settings;
- to develop, based on the above considerations, concrete policy conclusions.
The TIPP approach to achieving these objectives was largely based on a wide range of case studies covering different situations in different parts of Europe (20 case studies were effectively carried out). The TIPP project was thus designed to analyse, through these case studies, how different institutional arrangements, systems and settings as well as interactions between different actors, organizations and institutions affect the implementation of transport policies. The overall objective of the project has therefore been very general. This feature was further strengthened by the fact that the project aimed to cover all levels of policy-making from the local/regional to the national and the EU level.
TIPP has been a first project of its kind and therefore had to enter unknown territory in many respects. Naturally, to carry out genuine analysis many methodological alternatives exist and some choices had to be made.
The objectives of the project were pursued through the following groups of activities.
- Setting the stage for the project by tentatively identifying and discussing all relevant aspects of the project. This included discussing the main research questions and their policy relevance and links to actual policy-making at different levels (local/regional, national, EU), preliminary surveys of recent policy developments and related policy implementation problems and of possible theories and approaches for analysing them. Finally the case studies were reviewed and directions for their carrying out in efficient and effective ways were laid down.
- Development of a theoretical foundation and framework for the project to be applied in the surveys and case studies, and at a later stage of the project for drawing and organising the main results and conclusions and policy recommendations. Two main areas of work here included the development of so-called analytical framework and a detailed and comprehensive review of existing theories to be potentially used in the different case studies. A particular task was to develop concrete guidance and instructions for the surveys and the case studies.
- Carrying out the necessary surveys of institutional framework conditions in different parts of Europe. The objective was to provide a comprehensive picture of institutional framework conditions (constraints and enablers) for implementing transport policies throughout Europe, as well as to develop a methodology for carrying out the surveys.
A series of key dimensions were identified as the basis for the investigations based on the literature and other EU projects such as PROSPECTS (2003) and SPECTRUM (2003). These key dimensions are the identification of objectives, policy instruments, barriers, actors, decision-making processes and decision-making structures. A series of elements for each dimension was developed from the literature. In addition, a review of theories across a range of economic, psychological and sociological fields was conducted to identify a theoretical basis upon which to investigate the influence of the dimensions listed above on transport policy and implementation.
For each of the key dimensions, elements that have an identifiable positive or negative influence on the transport policy implementation were examined in the context of their importance to:
- the effectiveness or implementation of the range of policy instruments.
- individual modes and the integration between modes of transport (decision-making structures are often different for different modes of transport).
Twenty case studies were carried out and have been grouped into 3 main themes:
- Theme 1: Political acceptability and perceived legitimacy related problems
- Case Study 1: New Fare System of the DB
- Case study 2: The new HGV toll in Germany
- Case Study 3: Private Motorways in Hungary
- Case Study 4: Road Pricing in the Netherlands
- Theme 2: Government structure related problems
- Case Study 5: Recent Developments in Transport Policy Implementation in the UK
- Case Study 6: Decision-Making Process for the Selection of Transport Infrastructure Projects to be Funded by the European Community Support Framework
- Case Study 7: Institutional Intersections of the Decision-Making Process in Finland
- Case Study 8: Changing Transport Policies in the North-West Region of Russia
- Case Study 9: (De-)Centralisation of the Operation and Routine Maintenance of Federal Trunk Roads in Germany
- Case Study 10: The Regional Allocation of Railway Investments in Belgium
- Case Study 11: National vs. Local/Regional Authorities in Parking Policy in The Netherlands
- Case Study 12: Non-Motorised Transport in Transport Policy Making: The Situation in The Netherl
The project has identified five of the identified elements of decision-making structure as being of particular relevance to the European Commission, and the recommendations for each of them are:
1) The role of the EU.
The European Union has a key role in the specification of common approaches to pricing and in determining Europe-wide regulations for competition policy, safety and the environment. This role should be maintained and if necessary enhanced by ensuring that all national governments implement the agreed schemes and regulations.
The European Union also has an important role in specifying and financing international infrastructure projects, and in supporting projects at a regional level. While such support is welcome, care is needed to avoid such infrastructure being provided in ways which are inconsistent with regional and national transport strategies.
The European Union was instrumental in deregulating European airline markets in the 1990s.
However, bilateral agreements between EU member state governments and the US remain as an impediment to the efficient operation of transatlantic markets. These agreements should be replaced with a Common Atlantic Aviation Area. Establishing such an Area would require a multilateral effort in which the EU should play a key role.
Some aspects of regulation such as the opening up of rail markets are subject to wide variation of interpretation between member states. It will be important to monitor the effects of different approaches, and to tighten the specification of the regulatory structure in the light of evidence on good and less good practice. The varied experience in the UK, France and Germany raises the possibility that the EU should demand specific accompanying measures to promote competition.
2) The role of national government
Within the context of EU policies, national governments should take the principal responsibility for specifying regulations for safety and environmental issues, national services, and competition policy. They should also specify the basis of national pricing policies for public transport and monitor performance of regional and local authorities in terms of these regulations. In addition they will naturally be responsible for national infrastructure, such as high speed intermodal and rail services and international transport corridors, where the size and interregional character of the projects dictate that they be directed at
Strafica Ltd, Finland (Coordinator)
Katholieke Universiteit Leuven/Centre for Economic Studies, Belgium
adpC Sprl, Belgium
Berlin University of Technology/School of Economics & Management, Germany
Dresden University of Technology, Germany
Athens University of Economics and Business/Transportation Systems and Logistics Laboratory, Greece
Budapest University of Technology and Economics/Department of Transport Economics, Hungary
Economic and Social Institute/Free University Amsterdam, The Netherlands
University of Leeds/Institute for Transport Studies, The United Kingdom