IDEAS home Printed from https://ideas.repec.org/a/ags/ajaeau/22401.html

Deregulation And Efficiency In Grain Transport

Author

Listed:
  • Brennan, Donna C.

Abstract

In this paper, it is argued that removing restrictions on road transport will not be sufficient to encourage efficiency improvements in grain freight industry while rail authorities continue to operate as public monopolies. This is because of the structure of costs in the grain freight industry, which imply that road transport cannot compete with rail transport in areas where road is the more efficient mode. While the tendency for a regulated monopoly to cross-subsidise inefficient operations is common place, the focus in this analysis is on the nature of the cross-subsidy in the grain freight industry, and shows that it is a type of cross-subsidy that is well hidden by aggregation. A model of investment in a rail network is presented where the monopoly power afforded to the rail industry is shown to be due to economies of traffic density. A case study of the grain rail network in Western Australia is presented where it is shown that the rail authority has been able to maintain very uneconomic sections of rail line, despite the introduction of road competition and apparently competitive pricing practices.

Suggested Citation

  • Brennan, Donna C., 1995. "Deregulation And Efficiency In Grain Transport," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 39(2), pages 1-13, August.
    • Handle: RePEc:ags:ajaeau:22401
    DOI: 10.22004/ag.econ.22401
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/22401/files/39020129.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.22401?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Robert G. Harris, 1977. "Economies of Traffic Density in the Rail Freight Industry," Bell Journal of Economics, The RAND Corporation, vol. 8(2), pages 556-564, Autumn.
    2. Baumol, William J, 1982. "Contestable Markets: An Uprising in the Theory of Industry Structure," American Economic Review, American Economic Association, vol. 72(1), pages 1-15, March.
    3. Donna C. Brennan & Robert K. Lindner, 1991. "Investing In Grain Storage Facilities Under Fluctuating Production," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 35(2), pages 159-178, August.
    4. Won W. Koo & Ihn H. Uhw, 1984. "United States and Canadian Rail Freight-Rate Structures: A Carparative Analysis," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 32(2), pages 301-326, July.
    5. Brennan, Donna C. & Lindner, Robert K., 1991. "Investing In Grain Storage Facilities Under Fluctuating Production," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 35(2), pages 1-20, August.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Kingwell, Ross S., 2002. "Issues for Farm Management in the 21st Century: A view from the West," 2002 Conference (46th), February 13-15, 2002, Canberra, Australia 173982, Australian Agricultural and Resource Economics Society.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Brennan, Donna C., 1995. "Economic Issues in Farm-to-Port Grain Storage, Handling and Transport," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 63(01), pages 1-11, April.
    2. Waters II, William G., 2007. "Evolution of Railroad Economics," Research in Transportation Economics, Elsevier, vol. 20(1), pages 11-67, January.
    3. Brennan, Donna C., 1994. "Economies Of Throughput And Transport Bottlenecks In Grain Distribution Systems," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 38(3), pages 1-11, December.
    4. Qenani-Petrela, Eivis & Wandschneider, Philip R. & Mittelhammer, Ronald C. & McCluskey, Jill J., 2002. "Investing In Farm Worker Housing: A Multi-Season Peak-Load Analysis Of Washington State Data," 2002 Annual Meeting, July 28-31, 2002, Long Beach, California 36553, Western Agricultural Economics Association.
    5. Bruttel, Oliver, 2005. "Die Privatisierung der öffentlichen Arbeitsvermittlung : Erfahrungen aus Australien, den Niederlanden und Großbritannien (The privatisation of public employment services * experiences made in Australi," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 38(1), pages 7-29.
    6. Sen, Souvik & Ganguly, Sourav, 2017. "Opportunities, barriers and issues with renewable energy development – A discussion," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 1170-1181.
    7. Peter Brusov & Tatiana Filatova & Natali Orekhova, 2023. "Capital Structure Theory: Past, Present, Future," Springer Books, in: The Brusov–Filatova–Orekhova Theory of Capital Structure, chapter 0, pages 9-50, Springer.
    8. Peter Kuhn, 1982. "Malfeasance in Long Term Employment Contracts: A New General Model with an Application to Unionism," NBER Working Papers 1045, National Bureau of Economic Research, Inc.
    9. Mazali, Rogério & Rodrigues-Neto, José A., 2013. "Dress to impress: Brands as status symbols," Games and Economic Behavior, Elsevier, vol. 82(C), pages 103-131.
    10. Shamsul Arifeen Khan Mamun, 2012. "Stochastic estimation of cost frontier: evidence from Bangladesh," Education Economics, Taylor & Francis Journals, vol. 20(2), pages 211-227, May.
    11. Amit Ghosh, 2018. "What Drives Banking Industry Competition in Developing Countries?," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 43(4), pages 1-20, December.
    12. Bletschacher, Georg & Klodt, Henning, 1992. "Strategische Handels- und Industriepolitik: theoretische Grundlagen, Branchenanalysen und wettbewerbspolitische Implikationen," Open Access Publications from Kiel Institute for the World Economy 456, Kiel Institute for the World Economy.
    13. Burton, John & Hanlon, Pat, 1994. "Airline alliances: cooperating to compete?," Journal of Air Transport Management, Elsevier, vol. 1(4), pages 209-227.
    14. Makoto Yano, 2005. "Coexistence of large firms and less efficient small firms under price competition with free entry," International Journal of Economic Theory, The International Society for Economic Theory, vol. 1(3), pages 167-188, September.
    15. Néstor Duch-Brown & Martí Parellada-Sabata & Jose Polo-Otero, 2010. "Economies of scale and scope of university research and technology transfer: a flexible multi-product approach," Working Papers 2010/51, Institut d'Economia de Barcelona (IEB).
    16. Sinay, Tony, 2005. "Cost structure of osteopathic hospitals and their local counterparts in the USA: Are they any different?," Social Science & Medicine, Elsevier, vol. 60(8), pages 1805-1814, April.
    17. Boone, J., 2004. "Balance of Power," Other publications TiSEM d3f8cd4b-eaf0-4c1c-aed4-5, Tilburg University, School of Economics and Management.
    18. Klepper, Gernot, 1989. "Industrial policy in the transport aircraft industry," Kiel Working Papers 399, Kiel Institute for the World Economy.
    19. Müller, Gernot, 2006. "Zur Ökonomie von Trassenpreissystemen," WIK Discussion Papers 279, WIK Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste GmbH.
    20. Benard, Jean, 1987. "Socialist incentive schemes and price planning," CEPREMAP Working Papers (Couverture Orange) 8735, CEPREMAP.

    More about this item

    Keywords

    ;

    Statistics

    Access and download statistics

    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:ags:ajaeau:22401. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaresea.html .

    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.