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The economics of railways restructuring in South Korea

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  • The economics of railways restructuring in South Korea
  • Pittman, Russell; Choi, Sunghee
  • Munich University


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Title The economics of railways restructuring in South Korea
Similar Titles
Material Type Reports
Author(English)

Pittman, Russell; Choi, Sunghee

Publisher

[Munich]:Munich University

Date 2013-03
Series Title; No MPRA Paper / no. 44992
Pages 30
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < General
Territorial Development < Transport/Logistics
Holding Munich University

Abstract

South Korea, like many countries, is engaged in a policy debate concerning possible railways reforms. However, unlike most countries, here the focus of discussion has been the government’s proposal to open high-speed passenger train lines to a second train company that would supply on-track competition to KTX trains. While such a policy may indeed lead to lower fares and greater efficiency, worldwide experience casts doubt on the government’s hope that it would lead to such dramatic increases in ridership that the level of subsidies to the overall rail system could be reduced. We argue that a more promising reform strategy may be to introduce competition into freight rail. Based on the Latin American experience, creating independent, vertically integrated, competing freight railway companies could be expected not only to lower shipper rates and increase efficiency but also to raise considerable revenues from the private sector in franchising fees and new investments.