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Strategic Choice of Freight Mode and Investments in Transport Infrastructure within Production Networks

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  • Ying Yi Tsai

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    Abstract

    In the context of production linkages in which downstream producers require freight services provided by transport operators, the author show that the strategic choice of using an alternative transport mode does not necessarily induce lower access charges, relative to the standard transport mode. Additionally, he show that the nature of infrastructure investment determines the share of final goods delivery by the alternative transport mode. An immediate implication is that interactions among infrastructure investments; building transportation capacity costs; and industry-specific characteristics should be carefully assessed when planning transport infrastructure investments to enhance competitiveness in export markets. [ADBI Working Paper 132]

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    Paper provided by eSocialSciences in its series Working Papers with number id:3083.

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    Date of creation: Oct 2010
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    Handle: RePEc:ess:wpaper:id:3083

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    Keywords: production; transport operators; investment; capacity; export markets;

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    11. Miller, Nolan H & Pazgal, Amit I, 2001. "The Equivalence of Price and Quantity Competition with Delegation," RAND Journal of Economics, The RAND Corporation, vol. 32(2), pages 284-301, Summer.
    12. Gulyani, Sumila, 2001. "Effects of Poor Transportation on Lean Production and Industrial Clustering: Evidence from the Indian Auto Industry," World Development, Elsevier, Elsevier, vol. 29(7), pages 1157-1177, July.
    13. Spencer, Barbara J & Brander, James A, 1983. "International R & D Rivalry and Industrial Strategy," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 50(4), pages 707-22, October.
    14. Bougheas, Spiros & Demetriades, Panicos O. & Morgenroth, Edgar L. W., 1999. "Infrastructure, transport costs and trade," Journal of International Economics, Elsevier, Elsevier, vol. 47(1), pages 169-189, February.
    15. David L. Hummels & Georg Schaur, 2013. "Time as a Trade Barrier," American Economic Review, American Economic Association, American Economic Association, vol. 103(7), pages 2935-59, December.
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