Ricerc@Sapienza

European Union (EU) leaders have endorsed the objective of developing a EU-wide multimodal TEN-T (Trans European Network-Transport) by 2030, which will connect major airport hubs to the high-speed rail (HSR) network by 2050. Indeed, air transport and HSR are not simple competitors, but become complements on long-haul routes: if HSR is an effective substitute for flights, then connecting passengers might be offered a combined transportation service, which bundles domestic HSR and international air services through a multimodal hub.
In this context, we study the strategic formation of airline-HSR partnerships, depending on the sunk costs necessary to make cooperation effective and on transport operators bargaining power in negotiating agreements. We analyze the conditions under which a given type of intermodal agreement improves consumer surplus and social welfare, depending on the level of congestion at hub airports and on mode substitution between air and HSR services. We fill two important gaps in the academic literature. First, the literature finds that the welfare gains from an airline-HSR merger are driven by firms' profits rather than consumer surplus. Hence, antitrust authorities would hardly approve the merger. Second, the literature considers a scenario of full-scale cooperation in the whole transportation network that resembles an airline-HSR merger, and ignores transport operators' incentives to join the alliance.
Main outcomes are:
* Measurement of the potential gains and losses of the transport operators engaged in the different forms of cooperation;
* Assessment of the effects on consumers' surplus across the different forms of integration reported;
* Determination of the possible participation of regulators to avoid anti-competitive arrangements among operators and market foreclosure and identification of tests that provide a sufficient condition for consumer surplus to be higher under the agreement.