Air and rail : cooperating and competing ?

The objective of this paper is to explore how the development of air-rail intermodality, encouraged by the European commission, can have an impact on competitive and collusive behaviour on the part of the railway operators and airlines. Since they both are network industries, partnership on certain links will obviously have impacts on other links of the networks. By modelling in a simple setting the interactions that take place, we examine the consequences of intermodality in terms of financing and transport policy : is it possible to encourage intermodality without distorting competition on final consumer markets ?