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Agency decision making in freight distribution chains: Establishing a parsimonious empirical framework from alternative behavioural structures

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  • Hensher, David A.
  • Puckett, Sean M.
  • Rose, John M.

Abstract

In designing an approach to parameterise the preferences of agents in a distribution chain for retail goods, Hensher and Puckett [Hensher, D.A., Puckett, S.M., 2007. Theoretical and conceptual frameworks for studying agent interaction and choice revelation in transportation studies. International Journal of Transport Economics XXXIV (1), 17-47] set out a general framework in which two or more agents negotiate a contractual arrangement to provide distribution services. In developing a framework to guide the empirical study, recognition of the difficulty in sourcing agent pairs is a major challenge and one that entails some amount of practical compromise. In this paper we present a new conceptual framework capable of capturing, through ideas of concession and power, without explicit interaction between agents, the interactive element of choice and show how we implement this to deliver an empirical method that is tractable in terms of securing an adequate sample as well as being cost effective. We find that transporters appear to hold strong relative power with respect to on-time reliability and variable charges, regardless of the degree of concession offered by either type of decision maker; whereas shippers' preferences appear to dominate the supply chain response to policy measures influencing transit time. Importantly both transporters and shippers do have a significant role to play in the formation of distribution chain preferences.

Suggested Citation

  • Hensher, David A. & Puckett, Sean M. & Rose, John M., 2007. "Agency decision making in freight distribution chains: Establishing a parsimonious empirical framework from alternative behavioural structures," Transportation Research Part B: Methodological, Elsevier, vol. 41(9), pages 924-949, November.
  • Handle: RePEc:eee:transb:v:41:y:2007:i:9:p:924-949
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    References listed on IDEAS

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    1. Itzhak Gilboa & David Schmeidler, 1995. "Case-Based Decision Theory," The Quarterly Journal of Economics, Oxford University Press, vol. 110(3), pages 605-639.
    2. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521766555, December.
    3. Greene, William H. & Hensher, David A. & Rose, John, 2006. "Accounting for heterogeneity in the variance of unobserved effects in mixed logit models," Transportation Research Part B: Methodological, Elsevier, vol. 40(1), pages 75-92, January.
    4. Ann Brewer & David Hensher, 2000. "Distributed work and travel behaviour: The dynamics of interactive agency choices between employers and employees," Transportation, Springer, vol. 27(1), pages 117-148, February.
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    Citations

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    Cited by:

    1. William H. Greene & David A. Hensher, 2013. "Revealing additional dimensions of preference heterogeneity in a latent class mixed multinomial logit model," Applied Economics, Taylor & Francis Journals, vol. 45(14), pages 1897-1902, May.
    2. van den Heuvel, Frank P. & de Langen, Peter W. & van Donselaar, Karel H. & Fransoo, Jan C., 2013. "Regional logistics land allocation policies: Stimulating spatial concentration of logistics firms," Transport Policy, Elsevier, vol. 30(C), pages 275-282.
    3. David A. Hensher, 2011. "Valuation of Travel Time Savings," Chapters,in: A Handbook of Transport Economics, chapter 7 Edward Elgar Publishing.
    4. Liu, Weihua & Wang, Yijia, 2015. "Quality control game model in logistics service supply chain based on different combinations of risk attitude," International Journal of Production Economics, Elsevier, vol. 161(C), pages 181-191.
    5. Bliemer, Michiel C.J. & Rose, John M., 2011. "Experimental design influences on stated choice outputs: An empirical study in air travel choice," Transportation Research Part A: Policy and Practice, Elsevier, vol. 45(1), pages 63-79, January.
    6. Mesa-Arango, Rodrigo & Ukkusuri, Satish V., 2014. "Attributes driving the selection of trucking services and the quantification of the shipper’s willingness to pay," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 71(C), pages 142-158.
    7. Rojo, Marta & Gonzalo-Orden, Hernán & dell’Olio, Luigi & Ibeas, Ángel, 2012. "Relationship between service quality and demand for inter-urban buses," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(10), pages 1716-1729.

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