Theoretical work on auctions has shown conceptual benefits of awarding contracts to the bidderoffering the best combination of price and quality rather than the lowest bidder.Correspondingly, EU policy on public procurement promotes such multi-criteria bid evaluation,which is already common in Europe. However, very few empirical studies have examined theeffects of this policy. This study analyzes panel data on monitored quality in Swedish publicbus service contracts awarded using either mechanism. We do not find that the studiedimplementations of award mechanisms perform differently and conclude that the superiority ofthe currently promoted mechanism remains uncertain.

This paper evaluates the welfare effects of optimizing bus service fares and frequencies in small cities by modeling street congestion and crowding in public transport vehicles. The model is calibrated to the Swedish city of Uppsala. A simple demand model is used. Sensitivity analyses suggest that this is sufficient for representing important welfare effects. The results indicate that there would be large, robust welfare gains from reducing public transport supply in Uppsala, especially in the outer zone of the city where reductions of supply would be large compared to the current situation. The welfare gains from adjusting fares would be smaller.