This paper traces the various administrative and legislative steps in the reform of the motor carrier industry and their effects on the return to investors. The author concludes by asking whether the reduced return is an elimination of monopoly rents, or whether the previous earnings arose partly from the additional obligations placed on motor carriers.
Topic: 26. Economic: General
Problems associated with subsidising Australian non-urban rail services are revisited by evaluating the macro-economic impacts of a policy that would eliminate railway deficits. The model used demonstrates how several policy scenarios for the abolition of railway subsidies can be explored by simulating shocks to the economy. The results illustrate the range of economic benefits that could accrue from the abolition of subsidies and identifies interests most likely to benefit or lose from such a policy.
Systematic risk in the deregulated airline industry is found to be significantly lower, at least for national carriers, than under regulation; but it was much higher during the period of transition. National carriers have a greater systematic risk than regional carriers, but the difference is less after deregulation.
If a lower cost entrant cannot satisfy the shipper’s demand for frequency, the shipper will prefer to make loyalty contracts with the conference, so that the entrant will be effectually excluded.
There is little integration of shipping with production; the few instances accord with the institutional theory of the firm. The variety and flexibility of shipping contracts give many of the advantages of vertical integration without its costs.
Aerodynamics and economics are combined to show the effect on aircraft design of changes in relative prices, especially the price of fuel. Higher capital cost reduces operating cost. Only airlines that operate few miles per year will select cheaper aircraft with high running cost.
A case study shows that investment in shipping is profitable for Israel and makes net contribution of about 25 per cent to the balance of payments.
The existence of public utility bus services, often subsidised, is one reason why private carriers are seldom able to enter the market. But entry would usually produce a welfare gain.
The expected construction of the Metro line in Washington, D.C., increased values of some properties and decreased those of others. This paper considers some implications of proposals to tax the benefits.