Interaction of Air and High-Speed Rail in Japan

Abstract

There has been a unique convergence of factors that have contributed to Japan's outstanding public transportation system. The paper focuses on two modes of transportation: air and high-speed rail (HSR). These two modes do not complement each other as in Europe, but compete head-on in Japan. Moreover, Japan does not have to contend with market-distorting public subsidies, because both companies operating HSR in the corridor of interest are highly profitable, primarily because of their HSR service. The Japanese transportation system therefore provides an excellent environment in which to study the nature of competition between air and HSR. (Conventional rail is also discussed where appropriate.) Individual contributors to terminal pair choice are contrasted between air and HSR, and the trade-offs between accessibility, frequency, and speed are analyzed in detail.