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Transportation Time and Freight Cost

Author

Listed:
  • Yoko KONISHI
  • Se-il MUN
  • Yoshihiko NISHIYAMA
  • Masahiro KINOMURA

Abstract

This paper develops a model of freight transportation market, in which transportation time is endogenously determined in the market. Two types of transportation contract are considered: delivery with and without time designation. Theoretical analysis suggests that, in the presence of the uncertainty in transportation time, shippers choosing the time designation spend longer time for delivering cargos. We estimate the freight charge function, expressway choice model, and transportation time function, using microdata of freight flow in Japan. Based on the estimated freight charge function, we confirm the theoretical predictions. We also obtain the values of willingness to pay for time designation, as an alternative measure to evaluate the reliability value of transportation.

Suggested Citation

  • Yoko KONISHI & Se-il MUN & Yoshihiko NISHIYAMA & Masahiro KINOMURA, 2021. "Transportation Time and Freight Cost," Discussion papers e-21-007, Graduate School of Economics , Kyoto University.
    • Handle: RePEc:kue:epaper:e-21-007
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    References listed on IDEAS

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    1. KONISHI Yoko & Se-il MUN & NISHIYAMA Yoshihiko & Ji Eun SUNG, 2012. "Determinants of Transport Costs for Inter-regional Trade," Discussion papers 12016, Research Institute of Economy, Trade and Industry (RIETI).
    2. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    3. Shams, Kollol & Asgari, Hamidreza & Jin, Xia, 2017. "Valuation of travel time reliability in freight transportation: A review and meta-analysis of stated preference studies," Transportation Research Part A: Policy and Practice, Elsevier, vol. 102(C), pages 228-243.
    4. Small, Kenneth A., 2012. "Valuation of travel time," Economics of Transportation, Elsevier, vol. 1(1), pages 2-14.
    5. Fosgerau, Mogens & Karlström, Anders, 2010. "The value of reliability," Transportation Research Part B: Methodological, Elsevier, vol. 44(1), pages 38-49, January.
    6. W. Burke Jackson & James V. Jucker, 1982. "An Empirical Study of Travel Time Variability and Travel Choice Behavior," Transportation Science, INFORMS, vol. 16(4), pages 460-475, November.
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