Density and Scale Economies in the Public Road Transport: Empirical Evidence for Tunisia

This paper examines economies of scale and density in road transport. This study seeks to broaden the knowledge in the impact of the economies of scale and density drawn in and by the road transport sector in Tunisia. This investigation aims to not only grasp the possibility of a substitutability of the production factors used but also highlight the importance of the global productivity achieved in the operation of means of transport for the users and the community. The investigation of the 12 road transport companies in Tunisia reveals the existence of a homogeneity in the total production of these companies which vary with the size of the networks, the number of stops, and the number of employees, although it exists a strong heterogeneity concerning. This study shows the importance of enhancing a number of policies recommendations for the Tunisian road transport system through the joint improvement of the road infrastructure policy, of the fuel price policy, and of the fuel-efficient road vehicle policy in order to maintain sustainable road transport network.