IDEAS home Printed from https://ideas.repec.org/a/eee/transe/v39y2003i4p271-288.html
   My bibliography  Save this article

Transport cost functions, network expansion and economies of scope

Author

Listed:
  • Jara-Díaz, Sergio R.
  • Basso, Leonardo J.

Abstract

This paper shows technically that economies of transport network expansion should be viewed through the concept of economies of scope rather than through the concept of economies of scale. The basic technological dimensions that are specific to transport production are identified. The framework is used to derive explicit cost functions for two and three nodes systems in order to show how the potential technical advantages of network expansions (new nodes served) are transferred into transport cost functions. These advantages are shown to translate into economies of scope that can exist even under constant returns to scale.

Suggested Citation

  • Jara-Díaz, Sergio R. & Basso, Leonardo J., 2003. "Transport cost functions, network expansion and economies of scope," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 39(4), pages 271-288, July.
    • Handle: RePEc:eee:transe:v:39:y:2003:i:4:p:271-288
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1366554503000024
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Juan Martín & Augusto Voltes-Dorta, 2008. "Theoretical Evidence of Existing Pitfalls in Measuring Hubbing Practices in Airline Networks," Networks and Spatial Economics, Springer, vol. 8(2), pages 161-181, September.
    2. Fielbaum, Andrés & Jara-Diaz, Sergio & Gschwender, Antonio, 2020. "Beyond the Mohring effect: Scale economies induced by transit lines structures design," Economics of Transportation, Elsevier, vol. 22(C).
    3. Laird, James J. & Nellthorp, John & Mackie, Peter J., 2005. "Network effects and total economic impact in transport appraisal," Transport Policy, Elsevier, vol. 12(6), pages 537-544, November.
    4. Dan Liu & Zhenghong Deng & Qipeng Sun & Yong Wang & Yinhai Wang, 2019. "Design and Freight Corridor-Fleet Size Choice in Collaborative Intermodal Transportation Network Considering Economies of Scale," Sustainability, MDPI, vol. 11(4), pages 1-19, February.
    5. Leonardo J. Basso & Sergio R. Jara-Díaz & William G. Waters, 2011. "Cost Functions for Transport Firms," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 12, Edward Elgar Publishing.
    6. Leonardo J. Basso & Sergio R. Jara-Díaz, 2006. "Are Returns to Scale with Variable Network Size Adequate for Transport Industry Structure Analysis?," Transportation Science, INFORMS, vol. 40(3), pages 259-268, August.
    7. Christian von Hirschhausen & Astrid Cullmann, 2008. "Next Stop: Restructuring?: A Nonparametric Efficiency Analysis of German Public Transport Companies," Discussion Papers of DIW Berlin 831, DIW Berlin, German Institute for Economic Research.
    8. Domenico Gattuso & Margherita Malara & Gian Carla Cassone, 2020. "Planning and Simulation of Intermodal Freight Transport on International Networks. Hub and Spoke System in Euro-Mediterranean Area," Sustainability, MDPI, vol. 12(3), pages 1-14, January.
    9. Hörcher, Daniel & Tirachini, Alejandro, 2021. "A review of public transport economics," Economics of Transportation, Elsevier, vol. 25(C).
    10. Anne Lange & Werner Delfmann, 2017. "Network concentration indices for less-than-truckload transportation," Transportation, Springer, vol. 44(6), pages 1475-1497, November.
    11. Mehdi Farsi & Massimo Filippini & William Greene, 2005. "Efficiency Measurement in Network Industries: Application to the Swiss Railway Companies," Journal of Regulatory Economics, Springer, vol. 28(1), pages 69-90, July.
    12. Sergio Jara-Díaz & Antonio Gschwender & Meisy Ortega, 2014. "The impact of a financial constraint on the spatial structure of public transport services," Transportation, Springer, vol. 41(1), pages 21-36, January.
    13. van den Heuvel, Frank P. & de Langen, Peter W. & van Donselaar, Karel H. & Fransoo, Jan C., 2013. "Spatial concentration and location dynamics in logistics: the case of a Dutch province," Journal of Transport Geography, Elsevier, vol. 28(C), pages 39-48.
    14. Leonardo Basso & Sergio Jara-Díaz, 2006. "Distinguishing Multiproduct Economies of Scale from Economies of Density on a Fixed-Size Transport Network," Networks and Spatial Economics, Springer, vol. 6(2), pages 149-162, June.
    15. Flores-Fillol, Ricardo, 2010. "Congested hubs," Transportation Research Part B: Methodological, Elsevier, vol. 44(3), pages 358-370, March.
    16. Verny, Jerome & Grigentin, Christophe, 2009. "Container shipping on the Northern Sea Route," International Journal of Production Economics, Elsevier, vol. 122(1), pages 107-117, November.
    17. Johnston, Ahren & Ozment, John, 2013. "Economies of scale in the US airline industry," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 51(C), pages 95-108.
    18. Marcos Singer & Patricio Donoso & Sven Widdel, 2007. "¿Premian Las Tarifas El Desempeño Del Transportista?," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 10(1), pages 21-55.
    19. Jara-Díaz, Sergio R. & Cortés, Cristián E. & Morales, Gabriela A., 2013. "Explaining changes and trends in the airline industry: Economies of density, multiproduct scale, and spatial scope," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 60(C), pages 13-26.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:transe:v:39:y:2003:i:4:p:271-288. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/600244/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.