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Abstract

When a group of Northeast governors pushes hard for improvements in Northeast Corridor rail service between Boston and New York, federal rail officials and transportation regulators must decide the extent and nature of appropriate public investment in such a project. In assessing whether to take steps to reduce New York-Boston travel time to three hours, officials must analyze the nature of passenger destination demand, as well as the level of service already provided by private sector bus and rail competition. Finally, politics as well as technology mingle in a decision as to how best to upgrade the route. Existing technology may improve service quickly; in the long-term, expensive electrification of the whole line may be more efficient. The case provides a vehicle for the use of both microeconomic and statistical analysis in a public policy context.

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Abstract

When a group of Northeast governors pushes hard for improvements in Northeast Corridor rail service between Boston and New York, federal rail officials and transportation regulators must decide the extent and nature of appropriate public investment in such a project. In assessing whether to take steps to reduce New York-Boston travel time to three hours, officials must analyze the nature of passenger destination demand, as well as the level of service already provided by private sector bus and rail competition. Finally, politics as well as technology mingle in a decision as to how best to upgrade the route. Existing technology may improve service quickly; in the long-term, expensive electrification of the whole line may be more efficient. The case provides a vehicle for the use of both microeconomic and statistical analysis in a public policy context.

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