In the short term, there’s also a lack of capacity. Fares function as a limiter on the number of people using it. Too many people for your capacity? Raise prices. Spare capacity? Lower prices.

This can be solved by increasing capacity, but it takes time to figure out what the capacity necessary actually is and then buying more trains/buses and hiring/training drivers.

Not an issue, but in many cases the issue is service quality, not price.

My home city of Riga tried to do that after success in Tallinn. The mayor thought of releasing special Riga cards to residents. The issue was that many people come to Riga for work from other cities, towns and villages and they got angry to pay for transport. So mayor said to declare themselves in Riga instead of their home towns. That caused an uproar from town councils as that meant that they will lose all the tax income and won’t be able to provide local services. And Riga is already home to a third of the country’s population, so town budgets are overstretched.

In the end the government had to step in and ban the whole thing. The end.