Comparison of Private Transportation and Mass Transportation

This article examines the transportation market that is changing due to an ever changing global economy. Model A- private transportation depicts a decrease in demand shown as (D1) based on substitute goods available thus the resulting Model B- mass transportation depicts an increase in customer demand (D1) based on price sensitivity of consumers and the rise of complementary goods prices, such as fuel, insurance, maintenance, vehicle taxes and other costs that are required by customer's to buy to operate for private transportation vehicles. There are many non-monetary effects of owning private transportation and explained within the body of this paper as well.

One of the major factors for the decrease in demand is related to complementary goods that private transportation requires customers to purchase. With private transportation fuel is necessary to operate and at the present time the costs are rising at an enormous rate and have customers looking for substitutes for transportation. The other economic conditions that are rising and act as complementary goods for private transportation are insurance, maintenance, vehicle taxes and loan payments. Most of these costs are monthly and are causing customers monthly budget problems.

Mass transportation provided by government entities are becoming more of a substitute over private transportation for citizens in most large cities. The cost of initial implementation of mass transportation is very costly, but the long-term effects are favorable over private transportation. The limitation of mass transportation is that most just operate within a city's geographical area where private transportation can take citizens anywhere they want to go. Citizens usually have to pay a modest monthly fare fee to ride mass transportation, which is small compared to what private transportation requires along with all the complementary goods on a monthly basis.