The Impact of Deregulation on the Production Structure of the Motor Carrier Industry

Abstract

Empirical analysis of the motor carrier industry pre-and postregulatory reform reveals that deregulation resulted in signijicant changes in firm production structure and lower real average costs.Translog cost functions for firms operating in 1977 and 1983 were estimated and compared for "other specialized commodity" carriers. Fitted average costs were computed from these func- tions. The results indicate significant diflerences in the cost functions and real costs that cannot be attributed to technological changes but rather suggest e@ciency gains. The results also suggest that it is inappropriate to predict outcomes of deregulation using empirical analyses of firms in the regulated environment.* Assistant Professor, Colorado State University, and Associate Professor, Oregon State University. We thank John Tschirhart, David Glyer, Frank Wykoff, anonymous referees, and conference participants at the 1986 and 1987 WEA meetings for helpful suggestions. All errors are the responsibility of the authors.

Market access in regulated and unregulated markets: The continuing cost of interstate motor carrier regulation

“…A number of recent studies indicate that regulatory reform has had dramatic and positive effects on competitiveness and productivity (e.g., McMullen 1987;McMullen and Stanley 1988;Keeler 1989;Ying 1990a;1990b;Ying and Keeler 1991;and Boyer 1993). However, still other studies suggest that remaining restrictions continue to detract from economic efficiency by limiting the access carriers have to markets (e.g., Beilock and Kilmer 1986;Wilson and Dooley 1993).…”

An analysis of production cost inefficiency

“…Existing transportation studies validate the importance of shipment composition as a cost determinant (McMullen and Stanley, 1988;Friedlaender and Spady, 1981;and Spady and Friedlaender, 1978). For this industry, shipment type, S, is measured as the ratio of 'first proviso' shipment revenues to total operating revenues, where the first proviso classification refers to shipments of property used in a dwelling.…”

Study of efficiency trends and productivity changes in the US TL carriers: 2000-2009

“…Although DEA technique and Malmquist index technique have individually been utilised to analyse the motor carrier industry (McMullen, 1997;Min and Joo, 2006;Zhou et al, 2008), there are no studies thus far, which have applied DEA window analysis to the US motor carrier industry. This is probably the first study that combines DEA window analysis and Malmquist index approach to analyse the US motor carrier industry.…”