An Academic Analysis of Fairer Bus Lane Regulations
There are two main theoretical perspectives that may be used to provide insight into this bus lane issue. They concern analysis of market failure and government failure. Other forms of analysis that are relevant but beyond the scoper of this report are comparative institutional analysis and implementation analysis. Nevertheless, a comprehensive view of bus lane issues through the lenses of market failure and government will provide a satisfactory analysis of this bus lane issue.
MARKET FAILURE
The concept of market failure in policy analysis comes from the application of the basic market model in economics, which describes the dynamic relationship between producers and consumers. Before an analysis of market failure, it is important to understand the key assumptions of the market model[1] in order to identify how markets can fail or become inefficient in certain situations. Therefore, in terms of policy analysis, instances where markets fail (once identified) immediately cause us to think about remedies for those failures so that the market can function again as normal. Thus, market failure is a useful concept to consider regarding bus lanes because it presents rationales for government action in areas of concern.[2]
STEPS IN ASSESSING MARKET FAILURE[5]
1. The market that we are interested in here is road transport in auckland, with a focus on public transport concerning buses and bus lanes. Here, the good or service of interest is public transport buses.
2. The general public or motorists are consumers in this market. As road users, they are subject to bus lane measures and expected to comply with regulations. Bus lane regulations are enforced by the Auckland City Council, who are also the producers in this situation. Thus, as local government, the Council has power to create and enforce road rules.
3. Ideally, according to the market model[6], the Auckland City Council’s supply of bus services should be able to meet the demands of patrons. If this takes place, the market supply and market demand for public transport buses should meet at a point of equilibrium or economic efficiency, illustrated by the following Figure 1.0.
Figure 1.0 An Efficient Market for Public Bus Transportation
However, there has not yet been a proper example of how the market model can work efficiently in the area of public transport buses. In the past, production of reliable public transport has struggled to meet the demand for it. Of late, however, slow, yet marginal increases have been made. For example, in 2007, the use of public buses rose by 1.2 percent which is an improvement in contrast to declining figures reported in the previous three years.[7]
4. In the context of public bus transportation and bus lanes, market failures occur on a number of levels according to the six basic assumptions of the market model[8], two in particular relate directly to bus lane regulations. Firstly, we are interested in information asymetries[9] between motorists and the Auckland City Council regarding bus lane rules and enforcement measures. Secondly, we are concerned with negative externalities that accompany bus lanes by virtue of their function as public goods[10], meaning that any adverse side-effects are likely to reach those who are not directly related to the initial problem, e.g., bus users as well as motorists, etc.
5. The demand for public transport has always existed, however, past studies have shown that the lack of reliable public transport has stuggled to meet and maintain that demand.[11] Therefore, in its bid to support and encourage public transport, the Auckland City Council set in place bus priority measures,[12] such as bus lanes. These bus lane regulations in particular have caused tension between motorists and the Council. However, in their attempt to promote public transport through bus lanes, the Council has not properly considered the impacts on motorists or non-users of public transport yet according to the market model supply and demand should function mutually. Affected motorist have responded to this aggressively and therefore the market for public bus tranportation becomes less effective. Consumers in this situation are not being looked after and so their demand or appreciation of public bus transport shifts negatively.
6. Financial implications of this market failure may include the cost of a decrease in the use of public transport buses. This cost extends beyond loss of revenue from patron sales because less users of public tranport mean that roads will again become more congested and such physical constraints can make a number of business less productive from a logistical perspective. There is also a financial impact on motorists or consumers themselves in terms of higher personal expenses involved in not using pubic transport, i.e., fuel expenses.
7. The Auckland City Council has committed to a review of their current bus policies to see if conflicting areas can be made more acceptable. The Council is currently trialling new measures that are more considerate of all road users, e.g., trial of 50 metre markers.
8. Although market failure should be determined by market processes themselves, the market failure descrbed above is centred on the actions of the supplier in this market, i.e., the Auckland City Council. The market failure in this context, therefore, is essentially due to a few inaccurate policy actions, hence market failures can be addressed here by simply augmenting policy actions that did not work previously. This may include information campaigns to address information asymetries, etc.
GOVERNMENT FAILURE
When markets fail, government action is often required to help the market function more effectively. However, government failure occurs when “government actions, while at first seeming desirable, produce results that are not better, and potentially worse, than the results produced by apparently failing markets.”[3] This is because government interventions can themselves create problems. Hence, the concept of government failure in policy analysis has two main purposes. To remind us that government interventions are never “costless” and to highlight problems that government action itself can introduce into any given context.[4]
STEPS IN THE ANALYSIS OF GOVERNMENT FAILURE
Similar to our analysis of market failure in relation to public transport buses, Michael Mintrom provides another useful analytical framework for assessing government failure[13], which may be more appropriate for the issues contained in this report. Government failure describes the way in which “gvernment actions, while at first seeming desirable, can produce results that are not better and potentially worse, than the results produced by apparently failing markets.”[14] There are nine steps to analysing government failure:
1. This is a study concerning fairer bus lane regulations in Auckland, which was prompted by frustrations held by motorist in dealing with ambiguous bus lane procedures implemented by the Auckland City Council.
2. Bus lanes were introuduced to make buses more efficient in peak hour traffic. By making buses more efficient the plan was to attract more users of public transport and thus ease traffic congestion. The reduction of unnecessary traffic congestion has many advantages, ranging from environmental protection and increased productivity for businesses to simply more convinience for motorists and other road users.
3. Public transport is not usually the first or most desired travel option for people. Nevertheless, public transport is important and it should be promoted and encouraged. The Auckland City Council has made some effort in doing so. It is important to acknowledge the fact that centralised decision making in the area of public transport is probably the best and most effective way of dealing with the issue. Left to their own, citizens and independent organizations would most likely complicate the issue through forms of unfair competition. Furthermore, information about public transport is probably best disseminated by a central authority like the Council who has the resources to do so.
4. Bus priority measures[15] are in fact supported by most people and they are effective in making buses more efficient. Issues that have caused upset are more to do with enforcement measures – the 50 metre rule in particular. Indeed, some believe that the 50 metre rule is sufficient and acceptable but in response to the uprising about the difficulties of judging 50 metres without assistance, a possible augmentation may be to add permanent markers or signs that clearly singal motorists exactly when they are allowed to enter a bus lane. Futher, another possible (but less likely) alternative to this rule may be to ban cars from using bus lanes altogether where possible. Then, at least, confusion for motorists is minimised because the issue becomes more black and white.
5. One of the main allegations against bus lane regulations has been that current enforcement measures have been directy related to motivations of revenue raising by the Concil. This topic has received widespread media coverage. Most coverage details details rapid increases in revenue through the issuing of fines and infringements notices, particularly parking and bus lanes tickets. It was revealed that in 2009, then Mayor John banks had planned to use infringment revenues to offset proposed rates.
6. There are six[16] bus operators that service Auckland City, however, there is one main player in particular that has an almost monopolistic presence in the market. Transportation Auckland Cooperation Limited stands to benefit most from any bus priority measures implemented by the Council. Transport Auckland Cooperation Limited, which operates as Metrolink, Link, Go West, North Star and Waka Pacific, is likely to support government interventions in pubilc transport because it makes them more efficient and hence increases their patronage and revenues. This may be seen as an unfair advantage to certaine parties as a result of the Council’s policy.
7. Road safety issues have been identified in relation to bus lane regulation. It has been highlighted that confusion over the 50 metre rule may promt dangerous or irresponsible driving in busy traffic. For example, when a bus lane is filled with buses beyond the 50 metre mark (approx. 3 buses) at an intersection, a number of motorists wising to turn left are faced with one of two option: the first is to incoveniently miss or forfeit the turn; and the second is to make an attempt at cutting into the left lane (within the 50 metre limit) often at the last minute. This poses a dangerous situation for buses, their passengers, by-standing cars and the drivers willing to take such a risk. Additionally, in such cases there is also a risk to pedestrians. Often, vehicles turning left are not able to do so until pedestrians have crossed first, even when the ‘red arrow’ traffic light is no longer on. In such instances drivers turning left are expected to exercise their own caution in the absence of proper left side traffic signals. When bus lanes are thrown into the works, drivers turning left often have to rush to make their turn within the 50 metre distance yet this presents potential risks to pedestrians, since rush and panic are one of the leading causes of road accidents.
8. Government failure in the context of bus lane regulations suggests several insights for future rule makers. Firstly, in the endeavour to make buses and public transport more successful, bus priority measures like bus lanes should be formulated with both buses and motorists in mind. Current complications seem to stem from the fact that bus priority measures are approached from a one sided perspective, which narrowly focuses on making buses more efficient by whatever means possible, without considering the role that motorists themselves have to play in easing traffic congestion. Secondly, more attention should be given to educating and informing motorists about bus lane regulations. This step is often skipped over in the rush towards enforcement measures. Further, on the topic of enforcement, policy design should be continually measured against aims to be more trasparent, so that the enforcement authority’s credibility is not tarnished or resentment created.
9. In terms of bus lane regulations, reliance on government action is probably the best option for society, by virtue of the ‘public good’ nature of roads and public transport. It may be difficult (although not impossible) for private authorities to regulate and enforce bus lane reguations. What needs to happen then, is for the Auckland City Council to simply revisit and improve current practice on bus lane regulations.
Analysis
Here, bus lane issues have been applied to an analytical framework based on academic research (described above). Therefore analysis of the issues at hand have taken place on two levels: 1) market failure, 2) government failure. On both levels, it is anticipated that our analysis will tell us why bus lane rules are important, why they need to be addressed, what we can learn from bus lane experiences, and how new procedures are likely to progress with most success.
[1] Market failures can stem from information problems, poor specification of property rights, or technical challenges. (Mintrom, p.173)
[2] Michael, Mintrom. (forthcoming 2011). Contemporary Policy Analysis. New York: Oxford University press, p.176
[3] Michael, Mintrom. (forthcoming 2011). Contemporary Policy Analysis. New York: Oxford University press, p.221
[4] Ibid.
[5] The following points on market failure corresond to Michael Mintrom’s guidelines to using market failure as an analytical framework (Mintrom, pg.207)
[6] See assumptions of the market model (Mintrom, pg.175)
[7] Auckland Regional Council. “Auckland Regional Land Transport Committee: Strategy strengthens Auckland’s transport.” http://www.arc.govt.nz/albany/index.cfm?58A620FD-14C2-3D2D-B9CA-EA5858882785&objUUID=A16E7699-14C2-3D2D-B9BB-527C999B5053 (accessed October 12, 2010)
[8] See assumptions of the market model (Mintrom, pg.175)
[9] Information asymmetries describe problems that may arise when the parties to a transaction have different levels of relevant knowledge about the qualities, or attributes of the good or service to be supplied (Mintrom, p.178)
[10] Public goods are those available to all for use and consumption. In this regard, bus lanes were created to make public transport more efficient for all users.
[11] Michael, Mintrom. (forthcoming 2011). Contemporary Policy Analysis. New York: Oxford University press, p.221
[12] Bus priority measure is the collective used to describe a number of initiatives aimed at making buses more efficient, of which bus lanes are one. (See Background section of this report and Appendix 1)
[13] Michael, Mintrom. (forthcoming 2011). Contemporary Policy Analysis. New York: Oxford University press, p.221
[14] Ibid.
[15] See Bus Priority Measures
[16] The five main bus operators in Auckland are: 1) Transport Auckland Cooperation Limited, 2) Ritches Transport Holdings Limited, 3) Howick and Eastern Buses Limited, 4) Birkenhead Transport Limited, 5) Pavlovich Coachlines.