Marius

Norway's railway privatization represents a classic case of using structural reform to address what is fundamentally an investment problem. When the Norwegian parliament approved the railway reform, the country was facing significant infrastructure challenges that stemmed from decades of underinvestment rather than organizational inefficiency. The reform was implemented in 2017-2018, creating a fragmented system where responsibilities were divided among multiple entities, but the underlying in...

The Norwegian railway reform highlights a fundamental tension between profit maximization and public service provision. Since profit maximization is not the primary goal for public services, conflicts of interest frequently arise between principals (government) and agents (private operators). The Norwegian government's stated intention was to increase social welfare by exposing the industry to competition while maintaining state responsibility for the railway system, creating an inherent contrad...

An Actual Example: Level Crossing Safety Let me illustrate how fractured responsibilities play out in the real world with a situation that’s all too familiar in the Norwegian rail sector: level crossing safety. The Safety Dilemma Imagine you’re responsible for the railway infrastructure. Your job is to keep things safe, nothing more, nothing less. In some areas, there are hazardous level crossings. The simplest way to maintain safety? Lower the speed limit for trains passing through these spo...

The absence of a cohesive vision and clear, centralized responsibility in the Norwegian railroad system leads to inefficiencies, reduced accountability, and a poorer experience for passengers. Each organization works within its own bubble, often neglecting the broader needs of the railway as a public good and a vital part of Norway’s transport infrastructure. In this post I want to further explore the issues with this way of organizing the railroad. Fractured Responsibilities One of the most p...