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MaaS economics: Should we fight car ownership with subscriptions to alternative modes?

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Title: MaaS economics: Should we fight car ownership with subscriptions to alternative modes?
Authors: Horcher, D
Graham, DJ
Item Type: Journal Article
Abstract: Proponents of the Mobility as a Service concept claim that subscriptions to alternative modes can effectively reduce car ownership and the adverse effects of underpriced car use. We test this hypothesis in a microeconomic model with endogenous mode choice as well as car and subscription ownership. The model contains congestible urban rail and car sharing options as substitutes of underpriced private car use. We find that aggregate car ownership is not a reliable proxy for road congestion: subscriptions may reduce car ownership while increasing the vehicle miles travelled by remaining car owners. Subscriptions induce welfare losses for two reasons. First, pass holders overconsume the alternative modes, as the marginal fare they face drops to zero. Second, non-pass holders tend to shift to car use due to the crowding induced by pass holders, causing additional distortions. We illustrate numerically that differentiated pricing is more efficient in achieving the goals of MaaS.
Issue Date: Jun-2020
Date of Acceptance: 30-Mar-2020
URI: http://hdl.handle.net/10044/1/79056
DOI: 10.1016/j.ecotra.2020.100167
ISSN: 2212-0122
Publisher: Elsevier
Journal / Book Title: Economics of Transportation
Volume: 22
Copyright Statement: © 2020 Elsevier Ltd. All rights reserved. This manuscript is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/
Publication Status: Published
Article Number: 100167
Online Publication Date: 2020-04-08
Appears in Collections:Civil and Environmental Engineering