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Freight transport allocation in the European Economic Communities

Vassilios Alexiadis, University of Massachusetts Amherst


An objective of transport policy is to meet the transportation needs of the economy with a minimum expenditure of economic resources. During the 60's and 70's the distribution of freight traffic in Europe shifted towards road transport despite the price, market access, and capacity restrictions imposed on the trucking industry. In view of this, several EEC Commission proposals and Council of Ministers decisions have suggested reforms towards a more effective structure of the freight transport market in Europe. These proposals notwithstanding, overregulation in the European freight transport market continues to prevent this market from operating with maximum efficiency. Distortions in modal split result in inefficient use of available transport capacities and lead to increased costs in providing transport services.^ The primary focus of this research is the examination of international freight transport allocation in the EEC and its relation to freight transport regulation. A stochastic model based on consumer theory is employed in this examination. The model assists in the analysis of intermodal competition by examining the elasticities of substitution of transport demand between rail, truck, and inland waterways for 18 commodity groups.^ Another aim of this dissertation is to examine the deregulation alternative in the European freight transport market. The prevailing premise is that in conditions of perfect competition, static misallocations and deadweight losses are minimized, and, thus a near-optimum allocation of resources is achieved. Assuming post-deregulation price reductions in trucking, the welfare cost of traffic misallocation caused by current transport regulation is calculated. Furthermore, the likely effects of rate, entry, and exit deregulation in the European freight system are examined.^ The modelling approach used in this research covers the whole EEC mode-commodity system and views transport regulation and intermodal competition from a comprehensive, administrative standpoint. This dissertation by examining the effects of regulation on intermodal freight transport allocation, in intended to contribute to the goal of establishing a common internal market in Europe by 1992. ^

Subject Area

Civil engineering|Transportation

Recommended Citation

Alexiadis, Vassilios, "Freight transport allocation in the European Economic Communities" (1988). Doctoral Dissertations Available from Proquest. AAI8906249.