Home Railways Restructuring and Ukrainian Economic Reform
Article
Licensed
Unlicensed Requires Authentication

Railways Restructuring and Ukrainian Economic Reform

  • Russell Pittman EMAIL logo
Published/Copyright: April 21, 2015

Abstract

If the Ukrainian economy is to be successfully restructured going forward, a restructured railway system will have to be part of the picture. This paper begins with a discussion of the crucial role that the Ukrainian railway plays in the Ukrainian economy. We follow with a survey of the world experience with railways restructuring: a large number of countries have already undertaken the task of converting sagging government-owned monopoly railways into more dynamic and competitive transport enterprises, and their experience in very diverse settings may have important lessons to offer. We then examine the current state of rail reform plans in Ukraine. We conclude with discussions of alternative paths forward that seem most likely to be successful in Ukraine, based on both the experience elsewhere and the country’s current situation.

Acknowledgments

The author thanks Olena Nazarova for helpful comments on a previous draft, and Jeff Bergmann and Sam Larson for excellent research assistance. The views expressed are not purported to reflect the views of the U.S. Department of Justice.

References

Bitzan, John D. (1999), “The Structure of Railroad Costs and the Benefits/Costs of Mergers,” Research in Transportation Economics5, 152.10.1016/S0739-8859(99)80003-1Search in Google Scholar

Bitzan, John D. (2003), “Railroad Costs and Competition: The Implications of Introducing Competition to Railroad Networks,”Journal of Transport Economics and Policy37, 201225.Search in Google Scholar

Campos, J. (2001), “Lessons from Railway Reforms in Brazil and Mexico,”Transport Policy8, 8595.10.1016/S0967-070X(01)00007-5Search in Google Scholar

Chadwick, Edwin (1859), “Results of Different Principles of Legislation in Europe: Of Competition for the Field as Compared with Competition within the Field of Service,”Journal of the Royal Statistical Society, Series A22, 381420.10.2307/2338385Search in Google Scholar

Chapin, Alison, and StephenSchmidt (1999), “Do Mergers Improve Efficiency? Evidence from Deregulated Rail Freight,” Journal of Transport Economics and Policy33, 147162.Search in Google Scholar

Christensen Associates (2010), An Update to the Study of Competition in the U.S. Freight Railroad Industry: Final Report, Washington, DC: Surface Transportation Board, January.Search in Google Scholar

Couto, Antonio, and Daniel J.Graham (2009), “The Determinants of Efficiency and Productivity in European Railways,”Applied Economics41, 28272851.10.1080/00036840801949782Search in Google Scholar

Dementiev, Andrei (2006), “Reforming Russian Railways: Introduction of Competition and New Regulatory Challenges,” in RosarioMacario, ed., Competition and Ownership in Land Passenger Transport, Amsterdam: Elsevier.Search in Google Scholar

Demsetz, Harold (1968), “Why Regulate Utilities?”Journal of Law and Economics11, 5565.10.1086/466643Search in Google Scholar

Deville, Xavier, and FabienneVerduyn (2012), “Implementation of EU legislation on rail liberalization in Belgium, France, Germany and The Netherlands,” Brussels: National Bank of Belgium, Working Paper No. 221, March.Search in Google Scholar

ECMT (2004), Regulatory Reform of Railways in Russia, Paris: European Conference of Ministers of Transport.Search in Google Scholar

Estache, Antonio, AndreaGoldstein, and RussellPittman (2001), “Privatization and Regulatory Reform in Brazil: The Case of Freight Railways,”Journal of Industry, Competition and Trade1, 203235.10.1023/A:1012834715715Search in Google Scholar

Foster, Sir Christopher (1994), “The Economics of Rail Privatisation,” London: Centre for the Study of Regulated Industries Discussion Paper 7.Search in Google Scholar

Friebel, Guido, MarcIvaldi, and CatherineVibes (2010), “Railway (De)Regulation: A European Efficiency Comparison,”Economica77, 7791.10.1111/j.1468-0335.2008.00739.xSearch in Google Scholar

Growitsch, Christian, and HeikeWetzel (2009), “Testing for Economies of Scope in European Railways: An Efficiency Analysis,”Journal of Transport Economics and Policy43, 124.Search in Google Scholar

Gómez-Ibáñez, José, and Ginésde Rus (2006), Competition in the Railway Industry: An International Comparative Analysis, Northampton, MA: Edward Elgar.10.4337/9781847202949Search in Google Scholar

ITF (2014), Peer Review of Railway Freight Development in Mexico, Paris: International Transport Forum, February.Search in Google Scholar

Ivaldi, Marc, and Gerard J.McCullough (2001), “Density and Integration Effects on Class I U.S. Freight Railroads,”Journal of Regulatory Economics19, 161182.10.1023/A:1011149324027Search in Google Scholar

Ivaldi, Marc, and Gerard J.McCullough (2004), “Subadditivity Tests for Network Separation with an Application to U.S. Railroads,” London: Centre for Economic Policy Research, CEPR Discussion Paper 4392.Search in Google Scholar

Kahn, Alfred E. (1970), The Economics of Regulation: Principles and Institutions, New York: Wiley (repr. 1988, MIT Press).Search in Google Scholar

Knieps, Günter (2013), “Competition and the Railroads: A European Perspective,”Journal of Competition Law and Economics9, 153169.10.1093/joclec/nhs040Search in Google Scholar

Knieps, Günter (2014), “Competition and Third Party Access in Railroads,” in M.Finger, T.Holvad, and P.Messulam, eds., Rail Economics, Policy and Regulation in Europe, Cheltenham, UK: Edward Elgar.Search in Google Scholar

Kogan, Jorge (2006), “Latin America: Competition for Concessions,” in Gómez-Ibáñez, José, and Ginésde Rus, eds. Competition in the Railway Industry: An International Comparative Analysis, Northampton, MA: Edward Elgar.Search in Google Scholar

Merkert, Rico (2012), “An Empirical Study on the Transaction Sector Within Rail Firms,”Transportmetrica8, 116.10.1080/18128601003674235Search in Google Scholar

Merkert, Rico, A.S.J.Smith, and ChrisNash (2012), “The Measurement of Transaction Costs – Evidence from European Railways,” Journal of Transport Economics and Policy46, 349365.Search in Google Scholar

Mizutani, Fumitoshi, and ShujiUranishi (2013), “Does Vertical Separation Reduce Cost? An Empirical Analysis of the Rail Industry in European and East Asian OECD Countries,”Journal of Regulatory Economics43, 3159.10.1007/s11149-012-9193-4Search in Google Scholar

Montero, Juan J. (2014), “Rail Transport: A Balance Sheet,” European University Institute, Robert Schuman Centre for Advanced Studies, Working Paper RSCAS 2014/115.10.2139/ssrn.2535252Search in Google Scholar

Monti, Mario (2002), “Effective Competition in the Railway Sector: A Big Challenge,” Speech at UNIFE Annual Reception, Brussels, 21 May.Search in Google Scholar

Nash, Chris (2011), “Competition in Rail Passenger Services,” Slide presentation, Institute for Transport Studies, University of Leeds.Search in Google Scholar

Nash, Chris, Jan-EricNilsson, and HeikeLink (2013), “Comparing Three Models for Introduction of Competition into Railways,”Journal of Transport Economics And Policy47, 191206.Search in Google Scholar

Pittman, Russell (2003), “Vertical Restructuring (or Not) of the Infrastructure Sectors of Transition Economies,”Journal of Industry Competition and Trade3, 526.10.1023/A:1025418218566Search in Google Scholar

Pittman, Russell (2005), “Structural Separation to Create Competition? The Case of Freight Railways,”Review of Network Economics4, 181196.10.2202/1446-9022.1072Search in Google Scholar

Pittman, Russell (2007a), “Options for Restructuring the State-Owned Monopoly Railway,” In ScottDennis and WayneTalley, eds., Railroad Economics (Research in Transportation Economics, v. 20), New York, NY: Elsevier.10.1016/S0739-8859(07)20007-1Search in Google Scholar

Pittman, Russell (2007b), “Make or Buy on the Russian Railway? Coase, Williamson, and Tsar Nicholas II,”Economic Change and Restructuring40, 207221.10.1007/s10644-007-9024-2Search in Google Scholar

Pittman, Russell (2013a), “Blame the Switchman? Russian Railways Restructuring after Ten Years,” In MichaelAlexeev and ShlomoWeber, eds, The Oxford Handbook of the Russian Economy, Oxford: Oxford University Press.10.1093/oxfordhb/9780199759927.013.0001Search in Google Scholar

Pittman, Russell (2013b), “What Next for Russian Railways Restructuring?” Slide presentation, New Economic School, Moscow, September 30, http://www.slideshare.net/NewEconomicSchool/russian-railways-russell-pittmannes30sept2013Search in Google Scholar

Pittman, Russell (2014), “What Next for Ukrainian Railways Restructuring?” Slide Presentation, Kyiv School of Economics, Kyiv, July.Search in Google Scholar

Pittman, Russell, OanaDiaconu, Emanual Šip, AnnaTomová, and JerzyWronka (2007), “Competition in Freight Railways: ‘Above-the-Rail’ Operators in Central Europe and Russia,”Journal of Competition Law and Economics3, 673687.10.1093/joclec/nhm028Search in Google Scholar

Preston, John (2001), “The Franchising and Re-franchising of Passenger Rail Services in Britain,”Transportation Research Record1742, 19.10.3141/1742-01Search in Google Scholar

Preston, John (2009), “Competition for Long Distance Passenger Rail Services: The Emerging Evidence,” Paris: OECD and International Transport Forum Joint Transport Research Centre Discussion Paper 2009–23 (December).Search in Google Scholar

Preston, John, and DawnRobins (2013), “Evaluating the Long Term Impacts of Transport Policy: The Case of Passenger Rail Privatization,”Research in Transportation Economics39, 1420.10.1016/j.retrec.2012.05.019Search in Google Scholar

RSPP (2013), Evaluation of Most Feasible Infrastructure and Transportation Operations Integration Model in the Frame of Destination Freight Transportation Services Market Model Implementation Until 2015, Moscow: Russian Union of Industrialists and Entrepreneurs, Transport and Transport Infrastructure Committee, Conference Proceedings, May 20, 2013.Search in Google Scholar

Sánchez, Pedro Cantos, José ManuelPastor Monsálvez, and LorenzoSerrano Martínez (2008), “Vertical and Horizontal Separation in the European Railway Sector: Effects on Productivity,” Working Paper No. 12, Instituto Valenciano de Investigaciones Económicas, Valencia, Spain.Search in Google Scholar

Sánchez, Pedro Cantos, José ManuelPastor Monsálvez, and LorenzoSerrano Martínez (2012), “Productivity and Deregulation in European Railways,” documentos de trabajo 16, Fundación BBVA, Bilbao, Spain.Search in Google Scholar

Savignat, M.G., and ChrisNash (1999), “The Case for Rail Reform in Europe: Evidence from Studies of Production Characteristics of the Rail Industry,”International Journal of Transport Economics26, 201217.Search in Google Scholar

Thompson, Louis S. (2009), “Liberalization and Commercialization of the World’s Railways: Progress and Regulatory Issues,” Paris: International Transport Forum, Forum Paper 2009-6.Search in Google Scholar

Van de Velde, D., C.Nash, A.Smith, F.Mizutani, S.Uranishi, M.Lijesen, and F.Zschoche (2012), EVES-Rail: Economic Effects of Vertical Separation in the Railway Sector, Brussels: CER (Community of European Railways and Infrastructure Companies).Search in Google Scholar

Villa, Juan Carlos, and EmilioSacristán-Roy (2013), “Privatization of Mexican Railroads: Fifteen Years Later,”Research in Transportation Business & Management6, 4550.10.1016/j.rtbm.2012.11.012Search in Google Scholar

Wilson, Wesley W. (1997). “Cost Savings and Productivity in the Railroad Industry,”Journal of Regulatory Economics11, 2140.10.1023/A:1007946111577Search in Google Scholar

Xu, Yi-Chong (2004), Electricity Reform in China, India and Russia: The World Bank Template and the Politics of Power, Cheltenham, UK: Edward Elgar.Search in Google Scholar


Note

The author has worked on a large number of investigations and debates regarding US railways while at the Antitrust Division and has been a part of teams of experts considering railway reform issues in a diverse group of countries that includes Brazil, China, Mongolia, Romania, and the Russian Federation.


Published Online: 2015-4-21
Published in Print: 2015-6-1

©2015 by De Gruyter

Downloaded on 7.9.2025 from https://www.degruyterbrill.com/document/doi/10.1515/me-2015-0006/html
Scroll to top button