This paper reports on a pilot study into the performance of the Nairobi public transport system. This system is fully privately operated and largely deregulated. It consists of two subsystems competing on the same routes: traditional buses operated by Kenya Bus on the one hand, and a host of minibuses (matatu's) on the other. The main findings of the pilot study are that: (i) the traditional bus subsystem is outperformed, on average, by the minibuses at all times of the day as regards both time and monetary costs to the user, and (ii) the absence of competition from the traditional bus subsystem on a minibus-only route has not resulted in lower frequencies or higher occupancy rates or fares. The paper concludes that competition in the market in Nairobi between two different subsystems may eventually result in the demise of what is in theory the most efficient of the two: the traditional bus system. However, in view of competition which exists between minibuses operating on the same route, this may not necessarily result in the negative consequences for the user associated with `normal' monopolies.
Abstract