MODELLING THE DEMAND FOR FREIGHT TRANSPORT.

The demand for freight transport was the subject of very many studies in the 1970s and early 1980s. Yet during recent years there has been renewed interest by researchers and government agencies in this vitally important topic. It is expected that even more interest on the part of public and private agencies will become apparent with the signing of the 1989 Free Trade Agreement between Canada and the United States. Previous studies varied in their scope of analysis, according to their objectives. For example, studies that were primarily concerned with the investigation of modal competition used different techniques and procedures from those that were concerned with predicting the amount of freight movement at local or national level. A review of the literature on freight transport demand reveals that most studies have used models in a sequential decision-making framework. The lack of adequate data on goods movement has slowed down the development and application of "simultaneous" demand models of freight transport. In an attempt to bridge the gap, this paper presents a demand model for freight transport that: (1) combines the two decisions on mode choice and shipment size, and (2) uses the same amount and quality of data as would be required to develop a standard disaggregate mode choice model. The paper is organised as follows. Section 2 presents a review of previous approaches towards modelling demand for freight transport. Section 3 presents the theoretical model. Issues of identification and estimation of the proposed model are discussed in section 4. The application of this model to study the demand for freight transport is discussed in section 5. Finally, section 6 contains the conclusions.

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