1. "High-Speed Rail for CEE Countries" PRAGUE – 10 06 2016 High Speed Rail in France: from Ex-Ante to Ex-Post Evaluations 1 Pr. Yves Crozet

2. Contents 1) HSR in France: 2 2) HSR and regional development: does HSR rebalance the French economy? 3) Conclusion -30 years of development: geography matters - Cost Benefit Analysis -Up to what extent can we open new lines?

3. 253 stations in all, including 53 abroad

4. 30 years of HSR France 1981: opening of the Paris-Lyon line (serving the south- east). 1989-1990: opening of the Paris-Tours line (serving the south-west and Brittany). 1993: opening of the Paris-Lille line (serving northern France, Brussels and London). 2001: opening of the Lyon-Marseille line (serving the Mediterranean). 2007: opening of the first section of Paris-Est line (serving Lorraine, Alsace, Luxembourg and Germany). The second section will be opened in 2016 2011: opening of the first section of the Rhine-Rhône line (first section not linked directly to Paris).

5. High Speed Trains Traffics in Europe (Billion of pass.km/2012) 5

6. 6 200Km=125 miles 400Km=250miles 600 Km = 375 miles 253 stations in all, including 53 abroad

7. CBA: “Economic IRR” Ex anteEx post LN 1 (Sud-Est)16.5%15.2% LN 2 (Atlantique)12.0%8.5% LN 3 (Nord Europe)13.0%3.0% Interconnexion10.8%6.9% LN4 (Rhône-Alpes) 10.4% 6.1% LN5 (Mediterranée) 8.0% 4.1% Source: J. P. Taroux (op. cit.).

8. Intensity of traffic and Yield Management 8

9. Rail access charges in Europe (2010) 9

10. CBA: « socio-economic IRR » Ex anteEx post LN 1 (Sud-Est)28.0%? LN 2 (Atlantique)23.6%14.0% LN 3 (Nord Europe)20.3%5.0% Interconnexion18.5%15.0% LN4 (Rhône-Alpes)15.4%10.6% LN5 (Mediterranée)12.2%8.1%

11. 11 2500 km of new HSR lines within 2020 ??? To be compared with the HSR network in 2009 = 1875km National Scheme of Transport Infrastructures (2009)

12. HSR from profit to public subsidies? The main risk now is for public funds For Tour-Bordeaux, 4 billion of public money for 30 million (maximum) of passengers per year = 4,4 euros/p/day/50 years… But for Marseille-Nice, 15 billion of public money (2%) for 20 million of passengers per year = 24 euros/passenger/day/50 years…. but 12

13. HSR… “whatever the cost”! Public authorities are risk lovers, they have a convex utility function. Traffic forecast overestimation, building cost underestimation, high burden of financial charges.. Due to wrong (biased?) expectations concerning the economic impacts of the infrastructure, they prefer receiving a random wealth to receiving its mean with certainty (Expected utility). It is a big incentive for consultants and private companies to develop strategic behaviors 13

14. Contents 1) HSR in France: where does the success come from? 14 2) HSR and regional development: does HSR rebalance the French economy? 3) Conclusion -Rebalancing the French Economy? -City-specific impacts -winners and losers

16. 16 2500 km of new HSR lines within 2020 ??? To be compared with the HSR network in 2009 = 1875km National Scheme of Transport Infrastructures (2009)

17. Number of Jobs

19. Type :GIF

23. Who are the winners of HSR? Civil engineering companies Rail manufacturers Rail operators (sometimes) Infrastructure managers (sometimes) Rail users (time gains) Some specific firms of sub-part of firms (managers, metropolitan functions…) Regions ?? Cities ??

24. 24 Give me a lever long enough and a fulcrum on which to place it and I shall move the world. Archimedes Nb of trips GDP Time gains

25. CONCLUSION (1) Demography, geography, economy (macro and micro) are more important than speed gains Accessibility improvements by speed gains is not the same thing than density and proximity. Agglomeration effects are mainly the result of density I dot not contest the relationship between agglomeration and local productivity gains But I contest the transformation of 1) accessibility gains due to speed into agglomeration effects 2) the gains of HSR users into regional GDP growth

26. CONCLUSION (2) The key factors of success Geography: size of the cities, distance between cities (gravity model) Economy: demand and intensity of traffic History and institutions (Monopoly of SNCF) Rail industry + rail operator Technology Politics…. 26

27. References Crozet Y., 2016, Regional Impacts of High Speed Rail and Cross-Chanel Rail System in France: Accessibility is not enough, paper presented in Canterbury, 16 03 2016, 20 years under the channel and beyond: accessible regions, growing regions ? Crozet Y., 2014, High Speed Rail performance in France: from appraisal methodologies to ex-post evaluations, in, The economics of Investment in High Speed Rail, Round table report #155, ITF- OCDE, pages 73-105 Crozet Y., 2014, Extension of the High Speed Rail Network in France: Facing the Curse that affects PPPs in the Rail Sector, in Research in Transportation Economics, Volume 48, December 2014, Pages 401–409 27