Diversification strategies and scope economies: evidence from a sample of Italian regional bus transport providers
A growing number of Local Public Transport (LPT) companies diversify their production lines by providing a large set of services. We investigate the cost structure of a sample of LPT companies operating in Italy and assess the presence and the magnitude of scope economies. We split the whole sample of firms according to their diversification strategy: private firms, mainly diversifying in competitive transport related services and public firms providing nontransport services in regulated markets. Scope economies appear sizeable for both groups but higher for firms pursuing a transport related strategy, suggesting caution in the multiutility development pursued by public LPT firms in Italy.
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Document Type: Research Article
Publication date: 2012-08-01