Control Function Approach for Addressing Endogeneity on the London-Amsterdam Bimodal Corridor

Abstract

This research examines the competition between High-Speed Rail and air travel in the LondonAmsterdam bimodal corridor. Using Discrete Choice Models, we revealed endogeneity in the fare. To address this issue, we employed the Control Function approach, which allowed us to identify and rectify inaccuracies in fare estimates. Our findings indicate that the corrected model significantly outperforms the original endogenous model in terms of accuracy and reliability, underscoring the critical importance of addressing these methodological challenges.