Estimating Elasticities for Freight Transport Using a Network Model: An Applied Methodological Framework

Abstract

This paper presents a general framework that can be used to estimate direct and cross elasticities for freight transport using a network model. This methodology combines operational research (network assignments in a geographical information system) with more classical econometrics (multinomial logit choice models). The application of the method to a real-world case is illustrated by a simple model that relies on the generalized cost of transport as the only explanatory variable in the utility function. The methodological framework allows, however, for the implementation of more complex functions. Beside the generalized cost functions for road, rail and inland waterways transport, the network model needs origin-destination matrixes and digitized networks. They are imported from ETIS Plus, a European transport policy information system. A set of direct and cross elasticities is presented. The estimated values are obtained using two methods: the first computes standard elasticities, while the second estimates arc elasticities. Figures are presented for Europe and for a large region around the Benelux countries, where more competition exists between the three modes of interest.