A simplified CBA approach to appraise the benefits of bottleneck removal in rail transport. A case study in north-eastern Italy

The removal of infrastructure bottlenecks is widely considered among the most profitable interventions, in socio-economic terms, and rail transport is not an exception. However, the measurement of the related benefits is difficult and no specific manuals indications seem to exist. Rail bottlenecks removals generate two family of benefits, related to the removal of scarcity problems (surplus gains for users otherwise excluded, saved net external costs due to avoided mode or path shifts and possible wider economic effects) and of congestion problems (improvement in rail service performance). The aim of this paper is to propose a simplified approach to estimate the effects of a capacity constraint for a simple rail network, and assess its removal through a CBA. In the first part, we describe the costs and benefits involved in bottleneck removal projects, suggesting possible sources and references. Then we briefly analyse the transport economics literature on the evaluation of rail bottleneck removals and in particular on the aspects related to the consumers’ surplus. In the following we introduce the proposed methodology, based on the use of a standard logit model, to measure the rail users’ generalised costs with and without the capacity constraint, and the consequent users and social surplus variation. The model is specified initially for a single link and then extended to a more complex network. We also discuss the effect of regulation in the distribution of calculated surplus variations. We complete the paper with a numerical case study about the appraisal of capacity investments in Friuli-Venezia Giulia, a north-eastern Italian region whose main rail network is part of two European TEN-T corridors (Mediterranean and Baltic – Adriatic).