Is fare increment desirable for ensuring operational viability of private buses?

Document Type

Journal Article

Publication Date


Subject Area

place - asia, place - urban, mode - bus, economics - profitability, economics - fare revenue, operations - service span, policy - fares, planning - service rationalisation


Operational viability, Private bus service, Oversupply of buses, Generalized cost, Simulation model


The paper reports an investigation on the requirement of fare increment for achieving the operational viability of private buses in the context of an emerging country. Taking an existing route in Kolkata city which is served by private buses, several scenarios were investigated to achieve the viability of service through interventions in fare, design of service, and supply of buses. A simulation framework was used for the evaluation of various scenarios. The study brings out new evidences to question the conventional approach of increasing the bus fare to satisfy the operational viability. It is shown that the fare and the revenue requirements are distorted due to the oversupply of buses and non-optimal service. The analysis shows that even with the present fare, it is possible to resolve the viability issue by optimizing the service and supply. The results presented in the paper are case specific but are likely to encourage policy makers to carry out similar investigations in other cities in India as well as in other developing countries to improve urban bus service without putting an additional burden on the users.


Permission to publish the abstract has been given by Elsevier, copyright remains with them.


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