Towards a bottom-up estimation of a standard unit operating cost for bus operators: Methodology and policy implications in Italy

The paper proposes a bottom-up model for the calculation of unit operating costs of bus operators, with the aim of informing a more realistic calculation of standard costs in public transport. Standard costs are a key input for a more effective allocation of public resources to bus operators in Italy and allow for setting a virtuous circle towards more efficient public transport systems. Based on easy-to-collect data, an explicit dependence of some cost components upon relevant context/service variables faced by bus operators is introduced, ameliorating existing methods currently adopted. This enables bus operators to identify directions to improve their performance and public bodies to resort to more effective standard cost estimations. The viability of the proposed approach is showcased in the real case of Azienda Napoletana Mobilità, the biggest bus operator in the city of Naples (Italy), with examples of company-oriented and policy-oriented implications.