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The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport
In an industry plagued by underinvestment and unrest, the emergence of the publicly financed MyCiTi Bus Rapid Transit system has structurally altered the market structure of Cape Town road public transport. Due to the heavy dependence of its rollout on subsidised operating support, and the geographi...
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| Format: | Thesis |
| Language: | English |
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School of Economics
2016
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| _version_ | 1867613176821972992 |
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| access_status_str | Open Access |
| author | Eichhorn, Martin Thorne |
| author2 | Bhorat, Haroon |
| author_browse | Bhorat, Haroon Eichhorn, Martin Thorne |
| author_facet | Bhorat, Haroon Eichhorn, Martin Thorne |
| author_sort | Eichhorn, Martin Thorne |
| collection | Thesis |
| description | In an industry plagued by underinvestment and unrest, the emergence of the publicly financed MyCiTi Bus Rapid Transit system has structurally altered the market structure of Cape Town road public transport. Due to the heavy dependence of its rollout on subsidised operating support, and the geographies it has targeted, the distribution of subsidy benefits between households in the city has changed. In this context, this investigation looks to address the question: "Is Cape Town's road public transport affordable, and is subsidised operating support well targeted at poor households?" To do so, the paper evaluates the impact of the industry transition on transport affordability and subsidy distribution with the use of a best practice systematic framework. Revealed in the affordability analysis is that Cape Town road public transport remains unaffordable for the lower quartile of the household income distribution - a finding exacerbated by Cape Town's racial economic geographies. On top of this, distribution analysis shows the significant and regressive impact of the industry transition on the distributional consequences of Cape Town road public transport subsidisation. The central premise of this paper is that this evidence warrants the need to investigate alternative subsidy frameworks. Framed by Cape Town's underlying mobility needs and road public transport market structure, this paper designs and simulates the distributional consequences of an alternative subsidy. The simulation reveals that the regressive impact of the transition can be controlled, and the overall distribution improved, by deriving the subsidy framework by a set of demand-side variables. Rather than being viewed as the complete solution, the paper concludes that this simulation signals the need for follow-up research to validate the findings, and to explore the political and operational feasibility of a demand-side subsidy orientation more thoroughly. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/20030 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:31:58.458Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2016 |
| publishDateRange | 2016 |
| publishDateSort | 2016 |
| publisher | School of Economics |
| publisherStr | School of Economics |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/20030 The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport Eichhorn, Martin Thorne Bhorat, Haroon Economic Development In an industry plagued by underinvestment and unrest, the emergence of the publicly financed MyCiTi Bus Rapid Transit system has structurally altered the market structure of Cape Town road public transport. Due to the heavy dependence of its rollout on subsidised operating support, and the geographies it has targeted, the distribution of subsidy benefits between households in the city has changed. In this context, this investigation looks to address the question: "Is Cape Town's road public transport affordable, and is subsidised operating support well targeted at poor households?" To do so, the paper evaluates the impact of the industry transition on transport affordability and subsidy distribution with the use of a best practice systematic framework. Revealed in the affordability analysis is that Cape Town road public transport remains unaffordable for the lower quartile of the household income distribution - a finding exacerbated by Cape Town's racial economic geographies. On top of this, distribution analysis shows the significant and regressive impact of the industry transition on the distributional consequences of Cape Town road public transport subsidisation. The central premise of this paper is that this evidence warrants the need to investigate alternative subsidy frameworks. Framed by Cape Town's underlying mobility needs and road public transport market structure, this paper designs and simulates the distributional consequences of an alternative subsidy. The simulation reveals that the regressive impact of the transition can be controlled, and the overall distribution improved, by deriving the subsidy framework by a set of demand-side variables. Rather than being viewed as the complete solution, the paper concludes that this simulation signals the need for follow-up research to validate the findings, and to explore the political and operational feasibility of a demand-side subsidy orientation more thoroughly. 2016-06-17T06:28:56Z 2016-06-17T06:28:56Z 2015 Master Thesis Masters MCom http://hdl.handle.net/11427/20030 eng application/pdf School of Economics Faculty of Commerce University of Cape Town |
| spellingShingle | Economic Development Eichhorn, Martin Thorne The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport |
| thesis_degree_str | Master's |
| title | The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport |
| title_full | The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport |
| title_fullStr | The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport |
| title_full_unstemmed | The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport |
| title_short | The impact of subsidaries, pricing and market structure on affordability and redistribution : the case of Cape Town road public transport |
| title_sort | impact of subsidaries pricing and market structure on affordability and redistribution the case of cape town road public transport |
| topic | Economic Development |
| url | http://hdl.handle.net/11427/20030 |
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