I was not amused to see an entirely socialist position from Lok Satta on public transport.

I've been thinking a bit about this issue for a while, and have come to the view that there is no need for a government to be involved in supplying this "service".

All over the world, buses arise spontaneously to meet demand, like any other product. There is, no doubt, a particular issue with buses, to do with "excessive" competition (which then leads, in due course to cartels, and loss of competition). But Daniel Klein, Adrian Moore and Binyam Reja have proposed a model which is allows competition to resume in the bus market. I've also read the Klein et. al.'s book and believe that this is a perfectly workable model.

The ideal would be to entirely privatise roads, but that's somewhat challenging, and not many people have explored it fully (although there are a couple of books on this topic already). I'd like more research on this issue. As technology evolves, private roads will become entirely feasible.

Lok Satta should ask government to GET OUT of public transport, not ask for subsidies. Competitive market solutions in public transport are feasible, and will ensure that users pay – not the general taxpayer.

If congestion is an issue, congestion taxes can be imposed on vehicles based on level of congestion caused.

Related posts:

1. Are you young and brilliant? Want to learn about public policy?
2. India is trying to copy elements of Australia’s competition policy – with zero chance of success
3. The public goods provision question: Deepak Lal’s view
4. A liberal policy position on higher education
5. Pankaj Mishra’s absurd myth that India was never socialist!
6. Signalling quality through public rating surveys
7. “Maximum Retail Price”, the absurd idea that socialist India has invented
8. India needs a non-interfering agriculture policy
9. The Agility of Modern Public Services #2
10. Further notes on organic farming, GM and agriculture policy more generally