Yw. Kwon et al., RAILROAD DIFFERENTIAL PRICING IN UNREGULATED TRANSPORTATION MARKETS -A KANSAS CASE-STUDY, Logistics and transportation review, 30(3), 1994, pp. 223-244
Citations number
NO
Categorie Soggetti
Operatione Research & Management Science",Transportation
Many studies have demonstrated that railroads practiced differential p
ricing in the railroad pre-deregulation period. This has been attribut
ed to the high percentage of fixed-common costs and factor indivisibil
ities of railroads as well as their ability to separate markets by com
modity and region. These railroad cost and demand characteristics are
as much in evidence today as they were prior to 1980. However, empiric
al studies of grain transport markets have shown that increased intra
railroad competition under deregulation led to declines in rail grain
prices in the first half of the 1980s. This suggests that railroads ma
y not be able to employ differential pricing as much in competitive an
d unregulated transportation markets. Using data from the second half
of the 1980s, analysis indicates that railroads practice differential
pricing in the unregulated Kansas wheat transportation market. This is
true for both the intra Kansas and Kansas export wheat transportation
markets, although the determinants of railroad differential prices ar
e different in the two markets.