What we can learn 17 years after the reform in public bus transportation in Israel

After many years in which the transportation budget was directed mainly to investment in developing road infrastructure to improve travel in private vehicles, national policymakers in Israel decided to invest in the introduction of a comprehensive structural reform, to improve the public bus system. The paper examines this reform, which was first implemented in 2000. The focus is on reform of the bus services, which from 2000 to 2017 included the transfer of about half of the regular bus lines from the hands of two monopolies to private operators, by means of competitive tendering. The success of the reform in terms of efficiency, service level, fares, and passenger volume are reviewed; the disadvantages of the reform, as well as several important lessons to be learned from the reform process in Israel, are discussed.