Differences between Monopoly and Perfect Competition in Providing Public Transportation (Case Study: Lane No. 10 and 96 of Mashhad Bus System)

Abstract

Urban infrastructure systems are the pillars and backbone of cities and play a pivotal role in any development such as mobility, lodging, energy, portable water, sanitation and communication. As far as, there would be no development without good quality and sufficient infrastructure. In between, transportation development as an important infrastructure has a high impact on urban economic and sustainability and this is the reason why transportation is a main concern of urban operators in the whole world. This paper is aimed at deeping our understanding on the functioning of competition in the public transportation industry and to evaluate its effectiveness on urban economics and management. Therefore, Mashhad public bus transportation system that includes both monopoly and competition markets in, is chosen to provide a conceptual framework to identify the best practices for provision of this specific public infrastructure. So the main question is what the role of private sectors is and what are the differences between these two kinds of markets? In response, I am going to compare costs and revenues of both private sector and current Mashhad bus transportation system in order to compare maximum efficiency and profits in competition circumstances.