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Freight transport, policy instruments and climate

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    Abstract

    The impact of policy instruments supposed to reduce greenhouse gas emissions from road freight transports may seem smaller than expected. Using insights from economics and contract theory, the paper sorts out the (possible) instances of market failure in the freight transport market; operator market power, asymmetric information split incentives, and public goods. The primary limitations of standard policy instruments are demonstrated to be linked to unobservable information. Some of these may be reduced but not eliminated as information technologies develop, making it possible to observe, verify and provide contract-relevant information to the uninformed parties. There is little reason to believe that possible market failures present major limitations to the efficiency of economic instruments geared toward protecting the climate, other than possibly in the short run

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    File URL: http://www.transportportal.se/swopec/CTS2014-5.pdf
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    Bibliographic Info

    Paper provided by CTS - Centre for Transport Studies Stockholm (KTH and VTI) in its series Working papers in Transport Economics with number 2014:5.

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    Length: 25 pages
    Date of creation: 25 Mar 2014
    Date of revision:
    Handle: RePEc:hhs:ctswps:2014_005

    Contact details of provider:
    Postal: Centrum för Transportstudier (CTS), Teknikringen 10, 100 44 Stockholm, Sweden
    Web page: http://www.cts.kth.se/

    Related research

    Keywords: Freight transport; Climate; Greenhouse gas; Policy instruments; Asymmetric information; Split incentives;

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    1. George P. Baker & Thomas N. Hubbard, 2003. "Make Versus Buy in Trucking: Asset Ownership, Job Design, and Information," American Economic Review, American Economic Association, vol. 93(3), pages 551-572, June.
    2. Mandell, Svante, 2008. "Policies towards a more efficient car fleet," Working Papers 2008:12, Swedish National Road & Transport Research Institute (VTI).
    3. Carlén, Björn & Mandell, Svante, 2012. "On assessing climate effects of electrifying the transport sector," Working papers in Transport Economics 2012:11, CTS - Centre for Transport Studies Stockholm (KTH and VTI).
    4. Mandell, Svante, 2010. "Carbon Emission Values in Cost Benefit Analyses," Working Papers 2010:4, Swedish National Road & Transport Research Institute (VTI).
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