In article ,
wrote:
In article , (Roy
Badami) wrote:
In article ,
wrote:
In article , (Roy
Badami) wrote:
Er, it's not quite that simple. Cap and collar isn't cost-free to TOCs and
higher fares could drive passengers away, worsening their results.
Therefore they might not accept the change without some compensation.
Oh, I see. Yes, presumably there would have to be an agreed estimate
of demand elasticity to allow calculation of how many passengers would
be lost. You could then scale the revenue levels that cap and collar
are based on appropriately, and also calculate the change in subsidy
or premium.
Presumably the process won't be entirely cost free, but I'm not sure
I'd expect it to be hugely expensive either.
-roy