On the generalized cost - demand elasticity of intermodal container transport Bart Jourquin Louvain School of Management, Mons Campus
Lori Tavasszy Delft University of Technology / TNO, Delft, The Netherlands
Liwei Duan Southwest Jiaotong University, China / Delft University of Technology, The Netherlands With financial support of
Introduction
In the market area for container transport, trucks can be substitutes or complements to trains (or barges) Ø Substitutes : when used from origin to final destination Ø Complements : when used in the intermodal chain
Introduction Ø Elasticities important to assess impacts of transport projects and policies e.g. infrastructure, technology (LHV), tolls etc… Ø On some freight corridors, intermodal rail has a relatively high share. Still elasticities used concern conventional rail transport. Ø Literature contains a wide range of estimates of freight transport elasticities (differences in applied methodologies and data). But: Ø Only a few papers consider explicitly intermodal transport Ø Even fewer estimate the impact of the total haul length or the preand post-haulage distances on the market. Ø The impact of the “substitute/complement effect” has, to our knowledge, never been estimated.
Aim of the paper Ø Question: What is the impact of complementarity of freight transport modes on substitution elasticities? Ø Hypothesis: pre/post haulage has a dampening effect Ø Both direct elasticity of road and cross-elasticity of rail should be smaller in intermodal case than in conventional mode choice
Ø Analysis: Ø A stylized, theoretical model to explore system boundaries Ø A full empirical model of freight mode choice in Europe
versus
Synthetic model Ø Use of generalized costs Ø Values taken from Limbourg and Jourquin (2010) Ø Modal split:
Dn
R
Ø Random utility discrete choice model Ø Logarithmic logit (Abraham’s Law), with exponent = -1
D2
ln
l2
D1 l1
O
l0
r
T
D0
O = Origin D = Destination T = Terminal
Direct elasticity road Ø Road t.km elasticity for road costs -5% Ø Elasticity varies between -0.1 and -0.5 Ø Strong influence of PPH and main distance Ø Effect smaller with high overall distance or short PPH Ø Two factors have similar influence
Rail-Road cross elasticity Ø Rail t.km elasticity for road costs -5% Ø Elasticity varies between 0.4 and 0.6 Ø Strong influence of PPH and main distance Ø Effect smaller with high overall distance or short PPH Ø Two factors have similar influence
Real World model
Origins - destinations = Antwerp or Rotterdam
Example
Model specifications Ø Road competes with rail-road intermodal transport Ø Supernetwork model with 143 terminals Ø No pre- post-haulage at the maritime ports Ø Same costs values as in synthetic model Ø Logarithmic Logit (Abraham’s Law) Ø Calibration : r2 > 0.95
Results Elasticity for total haulage distances (road cost -5%) Road Rail-Road
All Antwerp -0.14 -0.16 0.70 0.81
Rotterdam -0.10 0.56
Short haul -0.10 0.54
Medium haul -0.14 0.71
Substitution only elasticity Road Rail-Road
All -0.16 0.85
« Complement effect » = 0.85 – 0.70 ≅ 20%
Long haul -0.19 0.98
Results Elasticity per Pre- Post-Haulage (PPH) distance, road cost -5% Road Rail-Road
Short PPH -0.19 0.97
Medium PPH -0.12 0.66
Long PPH -0.05 0.29
Elasticity per Pre- Post-Haulage (PPH) distance, rail cost -5% Road Rail-Road
Short PPH 0.11 -0.54
Medium PPH 0.14 -0.70
Long PPH 0.13 -0.72
Results with IWW
Elasticity for the three modes model (-5% of trucking costs) Mode Road Rail-Road IWW-Road
ε -0.28 0.61 0.31
Main conclusions Ø Estimations fall within broad range of published elasticity values, yet differences from conventional rail transport are significant Ø “Complement effect” ≅ 20% Ø Absolute value of own elasticity for trucking Ø Increases with the total length of the haul Ø Decreases with the length of the pre- post-haulage Ø Both influence have similar order of magnitude Ø IWW-Road is less sensitive than Rail-Road intermodal Ø Impact of mode choice model?
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