Definition of Relevant Market in Rail Transportation on the Route Prague - Košice using consumer survey
| Thesis title in Czech: | Využití spotřebitelského průzkumu na vymezení relevantního trhu v železniční dopravě na trase Praha - Košice |
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| Thesis title in English: | Definition of Relevant Market in Rail Transportation on the Route Prague - Košice using consumer survey |
| Key words: | relevant market, SSNIP test, critical loss analysis, critical elasticity, critical loss |
| English key words: | relevant market, SSNIP test, critical loss analysis, critical elasticity, critical loss |
| Academic year of topic announcement: | 2014/2015 |
| Thesis type: | diploma thesis |
| Thesis language: | angličtina |
| Department: | Institute of Economic Studies (23-IES) |
| Supervisor: | PhDr. Pavel Vacek, Ph.D. |
| Author: | hidden - assigned by the advisor |
| Date of registration: | 18.06.2015 |
| Date of assignment: | 18.06.2015 |
| Date and time of defence: | 15.09.2016 00:00 |
| Venue of defence: | IES |
| Date of electronic submission: | 29.07.2016 |
| Date of proceeded defence: | 15.09.2016 |
| Opponents: | PhDr. Petra Luňáčková |
| URKUND check: | |
| References |
| Bishop, S. & Walker, M., 2010. The economics of EC competition law: concepts, apllication and measurement 3rd ed., London: Sweet & Maxwell.
Davis, P.J. & Garcés, E., 2010. Quantitative techniques for competition and antitrust analysis, Princeton: Princeton University Press. European Commission, 1997. Commission Notice on the definition of relevant market for the purposes of Community competition law Funta, R., 2011. Abuse of dominant position in EU and U.S. law 2., amplified and extended ed., Brno: Tribun EU. Horowitz, I., 1981. Market Definition in Antitrust Analysis: A Regression-Based Approach. Southern Economic Journal, 48(1), pp.1-16. Massey, P., 2000. Market Definition and Market Power in Competition Analysis: Some Practical Issues. The Economic and Social Review, 31(4), pp.309-328. Motta, M., 2004. Competition policy: Theory and Practice, Cambridge: Cambridge University Press. O'Donoghue, R. & Padilla, J.A., 2013. The law and economics of article 102 TFEU 2nd ed., Oxford: Hart publishing. |
| Preliminary scope of work |
| Motivation:
The aim of the thesis is to define the relevant market in rail transportation on the route Prague - Košice. The definition of relevant market is important for competition policy and is used by regulatory authorities as the first step for the assessment of infringements of the competition rules. The route between Prague and Košice was chosen because of the past dominant position of the operator České dráhy on railway, high competition between rail and bus transport and recent entrance of new competitors on the railway market, which lowered the prices, improved the services and comfort and heightened the competition even more. In previous years, activities of operator Student Agency were intensely watched by competition authorities, especially on the routes within the Czech Republic. The company entered the Slovak transportation market as well, causing huge competition within public transportation. With its pricing policy, it even forced ZSSK to stop dispatching IC trains between Bratislava and Košice. Therefore, we will have a closer look at RegioJet and try to determine if it could be a hypothetical monopolist within the Hypotheses: Hypothesis #1: Bus is a perfect substitute for rail transportation on the route Prague - Košice. Hypothesis #2: The operator RegioJet forms a separate relevant market on the route Prague - Košice. Hypothesis #3: The demand for rail transportation on the route Prague - Košice is inelastic. Methodology: The first part of the thesis will be focused on theoretical concept of relevant market. We will describe the methods of defining the relevant market and the application of SSNIP test. Then the characteristic of transport situation on the route from Prague to Košice. will follow. For the empirical part of the thesis we will conduct a consumer survey among passengers travelling by train from Košice to Prague during different times and days. Survey will be conducted by directly asking customers at the train station of the particular rail operator. The focus of the survey will be on the reaction of customers on a hypothetical increase in the price of their ticket. The data collected will be used to compute elasticity of demand for rail transportation. We will than perform the SSNIP test by critical loss analysis. Expected Contribution: We will study the market for transportation services from Prague to Košice and analyze the demand for rail transportation on the route and price sensitivity of passengers. Using the data from the survey, we will compute elasticity of demand for rail transportation.. I will use the computed elasticity to define the relevant market for transportation from Košice to Prague.. I will examine if the bus and rail transportation form one market and if bus is a perfect substitute for rail transportation. Outline: 1. Introduction 2. Relevant market: definition, its importance, methods of defining relevant market 3. SSNIP test 4. Market situation: characteristics of transport, means of transport, providers on the route from Prague to Košice 5. Consumer survey: theoretical concept, application of tests 6. Results: discussion of the findings and their analysis 7. Conclusion |