Rail Economics, Policy and Regulation in Europe

Rail Economics, Policy and Regulation in Europe

Edited by Matthias Finger and Pierre Messulam

The European railway sector has undergone profound and predominantly institutional changes over the past 20 years, due to the initiatives of the European Commission. This book constitutes a first systematic assessment and account of the recent transformations of the industry along a series of critical yet contentious issues such as competition, unbundling, regulation, access charging, standards and interoperability, and public–private partnerships. It also covers the main railways sectors including passenger transport, high speed and freight.


Matthias Finger and Pierre Messulam

Subjects: economics and finance, transport, politics and public policy, regulation and governance, urban and regional studies, transport


The process of railway reform in Europe started at the end of the 1980s and was the result of a few undisputed observations; basically, railways had witnessed a constant and worrisome erosion of their modal market share since the Second World War. They had become a growing burden on the public finances and had been incapable of responding to the new increasingly intermodal and international reality, and incapable of reforming themselves. Starting out as national public monopolies, it became necessary and – in the context of the globalization and liberalization of the 1980s – acceptable to make these railways more management-oriented; this process was notable because it weakened the railways’ close relationships with government and opened up the railway market to competition. Indeed, as it seems, only a certain degree of market pressure seemed to be able to trigger the necessary reforms that governments had not been able to carry out. This is where the European Union comes into play. Indeed, in the late 1980s the European Commission appeared to become increasingly worried about the sagging European railways, which were losing market share, as road and air transport grew exponentially and started to pose environmental and energy-related challenges. The Commission’s policy was to revitalize the European rail industry by way of market opening, by ending state monopolies and by enhancing technical interoperability in order to lower entry barriers.