IDEAS home Printed from https://ideas.repec.org/a/pch/abante/v10y2007i1p21-55.html

¿Premian Las Tarifas El Desempeño Del Transportista?

Author

Listed:
  • MARCOS SINGER

    (Escuela de Administración, Pontificia Universidad Católica de Chile)

  • PATRICIO DONOSO

    (Escuela de Administración, Pontificia Universidad Católica de Chile)

  • SVEN WIDDEL

    (Escuela de Administración, Pontificia Universidad Católica de Chile)

Abstract

We develop an agency model subject to moral hazard to evaluate whether delivery prices reward carriers for their performance, or arbitrarily benefit some carriers and harm others. From the model, we derive several propositions that we test on a panel data of 58 carriers that work for a shipper in Santiago, over 93 weeks. We verify that the shipper rewards the experience, fleet size and service quality provided by the carrier, but not the quality of the trucks. The carrier has incentives to visit many clients, but not to travel longer distances. We also confirm that prices are sensitive to the alternatives to the agreement between the shipper and the carrier. However, a number of carriers are over or under compensated for no apparent reason.

Suggested Citation

  • Marcos Singer & Patricio Donoso & Sven Widdel, 2007. "¿Premian Las Tarifas El Desempeño Del Transportista?," Abante, Escuela de Administracion. Pontificia Universidad Católica de Chile., vol. 10(1), pages 21-55.
    • Handle: RePEc:pch:abante:v:10:y:2007:i:1:p:21-55
    as

    Download full text from publisher

    File URL: http://www.abante.cl/files/ABT/Contenidos/Vol-10-N1/Singer.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Anantaram Balakrishnan & Harihara Prasad Natarajan & Michael S. Pangburn, 2000. "Optimizing Delivery Fees for a Network of Distributors," Manufacturing & Service Operations Management, INFORMS, vol. 2(3), pages 297-316, August.
    2. Steven M. Shugan, 2004. "The Impact of Advancing Technology on Marketing and Academic Research," Marketing Science, INFORMS, vol. 23(4), pages 469-475.
    3. repec:bla:jfinan:v:59:y:2004:i:4:p:1619-1650 is not listed on IDEAS
    4. Min, Hokey, 1998. "A personal-computer assisted decision support system for private versus common carrier selection," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 34(3), pages 229-241, September.
    5. John W. Pratt, 2000. "Efficient Risk Sharing: The Last Frontier," Management Science, INFORMS, vol. 46(12), pages 1545-1553, December.
    6. Hubbard, Thomas N, 2001. "Contractual Form and Market Thickness in Trucking," RAND Journal of Economics, The RAND Corporation, vol. 32(2), pages 369-386, Summer.
    7. Jack A. Nickerson & Brian S. Silverman, 2003. "Why aren't all Truck Drivers Owner‐Operators? Asset Ownership and the Employment Relation in Interstate for‐hire Trucking," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 12(1), pages 91-118, March.
    8. Francine Lafontaine & Scott E. Masten, 2002. "Contracting in the Absence of Specific Investments and Moral Hazard: Understanding Carrier-Driver Relations in U.S. Trucking," NBER Working Papers 8859, National Bureau of Economic Research, Inc.
    9. Hart, Oliver, 1995. "Firms, Contracts, and Financial Structure," OUP Catalogue, Oxford University Press, number 9780198288817.
    10. George P. Baker & Thomas N. Hubbard, 2004. "Contractibility and Asset Ownership: On-Board Computers and Governance in U. S. Trucking," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(4), pages 1443-1479.
    11. Jara-Díaz, Sergio R. & Basso, Leonardo J., 2003. "Transport cost functions, network expansion and economies of scope," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 39(4), pages 271-288, July.
    12. Lim, Wei Shi, 2000. "A lemons market? An incentive scheme to induce truth-telling in third party logistics providers," European Journal of Operational Research, Elsevier, vol. 125(3), pages 519-525, September.
    13. George B. Kleindorfer & Liam O'Neill & Ram Ganeshan, 1998. "Validation in Simulation: Various Positions in the Philosophy of Science," Management Science, INFORMS, vol. 44(8), pages 1087-1099, August.
    14. M Singer & P Donoso & S Jara, 2002. "Fleet configuration subject to stochastic demand: an application in the distribution of liquefied petroleum gas," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 53(9), pages 961-971, September.
    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. Singer, Marcos & Donoso, Patricio, 2011. "Contracting contractors," Journal of Business Research, Elsevier, vol. 64(3), pages 338-343, March.

    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. Singer, Marcos & Donoso, Patricio, 2011. "Contracting contractors," Journal of Business Research, Elsevier, vol. 64(3), pages 338-343, March.
    2. Haili Zhang & Michael Song & Xiaoming Yang & Ping Li, 2019. "What are Important Technologies for Sustainable Development in the Trucking Industries of Emerging Markets? Differences between Organizational and Individual Buyers," Sustainability, MDPI, vol. 12(1), pages 1-23, December.
    3. Sharon Novak & Scott Stern, 2009. "Complementarity Among Vertical Integration Decisions: Evidence from Automobile Product Development," Management Science, INFORMS, vol. 55(2), pages 311-332, February.
    4. Francine Lafontaine & Laura Malaguzzi Valeri, 2009. "The deregulation of international trucking in the European Union: form and effect," Journal of Regulatory Economics, Springer, vol. 35(1), pages 19-44, February.
    5. Josef Windsperger & Maria Jell, 2005. "Structuring residual income and decision rights under internal governance: results from the Hungarian trucking industry," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 26(5), pages 295-305.
    6. Francine Lafontaine & Margaret Slade, 2007. "Vertical Integration and Firm Boundaries: The Evidence," Journal of Economic Literature, American Economic Association, vol. 45(3), pages 629-685, September.
    7. Timothy Bresnahan & Jonathan Levin, 2012. "Vertical Integration and Market Structure [The Handbook of Organizational Economics]," Introductory Chapters,, Princeton University Press.
    8. George P. Baker & Robert Gibbons & Kevin J. Murphy, 2008. "Strategic Alliances: Bridges between "Islands of Conscious Power"," NBER Chapters, in: Organizational Innovation and Firm Performance, pages 146-163, National Bureau of Economic Research, Inc.
    9. Benito Arruñada & Manuel González-Díaz & Alberto Fernández, 2004. "Determinants of organizational form: transaction costs and institutions in the European trucking industry," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 13(6), pages 867-882, December.
    10. Oliver Hart, 2013. "Noncontractible Investments and Reference Points," Games, MDPI, vol. 4(3), pages 1-20, August.
    11. Dildar Hussain & Josef Windsperger, 2013. "A property rights view of multi-unit franchising," European Journal of Law and Economics, Springer, vol. 35(2), pages 169-185, April.
    12. Evan Rawley & Timothy S. Simcoe, 2013. "Information Technology, Productivity, and Asset Ownership: Evidence from Taxicab Fleets," Organization Science, INFORMS, vol. 24(3), pages 831-845, June.
    13. Robert Gibbons & John Roberts, 2012. "The Handbook of Organizational Economics," Economics Books, Princeton University Press, edition 1, volume 1, number 9889, December.
    14. Oriol Carbonell-Nicolau & Diego Comin, 2005. "Testing Out Contractual Incompleteness: Evidence from Soccer," Departmental Working Papers 200501, Rutgers University, Department of Economics.
    15. Hart, Oliver D., 2013. "Noncontractible Investments and Reference Points," Scholarly Articles 29058539, Harvard University Department of Economics.
    16. Andrabi, Tahir & Ghatak, Maitreesh & Khwaja, Asim Ijaz, 2006. "Subcontractors for tractors: Theory and evidence on flexible specialization, supplier selection, and contracting," Journal of Development Economics, Elsevier, vol. 79(2), pages 273-302, April.
    17. Alper Duman, 2009. "Comparative Analysis of Organizational Forms in the Software Industry and Legal Services," Working Papers 0903, Izmir University of Economics.
    18. Brian S. Silverman & Paul Ingram, 2017. "Asset ownership and incentives in early shareholder capitalism: Liverpool shipping in the eighteenth century We are deeply indebted to historians Nick Radburn and especially Stephen Behrendt for extensive discussions of eighteenth-century transatlant," Strategic Management Journal, Wiley Blackwell, vol. 38(4), pages 854-875, April.
    19. Jason Miller & Keith Skowronski & John Saldanha, 2022. "Asset ownership & incentives to undertake non‐contractible actions: The case of trucking," Journal of Supply Chain Management, Institute for Supply Management, vol. 58(1), pages 65-91, January.
    20. Francine Lafontaine & Scott E. Masten, 2002. "Contracting in the Absence of Specific Investments and Moral Hazard: Understanding Carrier-Driver Relations in U.S. Trucking," NBER Working Papers 8859, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation

    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:pch:abante:v:10:y:2007:i:1:p:21-55. 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: Eduardo Walker (email available below). General contact details of provider: https://edirc.repec.org/data/eapuccl.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.