Stable Service Patterns in Scheduled Transport Competition

In a horizontal product differentiation model, it is shown that a stable service pattern in scheduled transport competition only exists if consumers are sufficiently sensitive to the quality of non-scheduling service characteristics. Since this sensitivity is related to travel distance, the modelling results can explain why competition in local public transport results in unstable service patterns while competition in longer-distance air transport does not have the same problem. © 2006 LSE and the University of Bath