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Q2 Z2,(Q2) Z2(Q2) - Institute for Water Resources - U.S. Army

Q2 Z2,(Q2) Z2(Q2) - Institute for Water Resources - U.S. Army

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commodities and, conceptually, transport demands could be estimated<br />

either directly or indirectly through estimates of regional product<br />

demands and supplies. Three of the four empirical studies we reviewed<br />

were <strong>for</strong>ced to abandon the point-to-point flow concept completely. Due<br />

basically to data limitations they were able to operate only with ag-<br />

gregate shipments, composed of many point-to-point flows of many com-<br />

modities. The degree of necessary aggregation varied in the different<br />

applications; and we shall discuss them in the order of the grossness of<br />

their input data, from more aggregate to less. These studies all con-<br />

sidered several transport modes, and two of them examined cross modal<br />

effects. The fourth study to be reviewed, by E. Silberberg, differs<br />

fundamentally from the others. He first attempts to estimate regional<br />

supplies and demands <strong>for</strong> several commodities. These regional estimates<br />

are then entered as inputs into a linear programming model to predict<br />

the flows of trade between the regions under the assumption that the •<br />

competitive environment actually minimizes transport costs. Discussion<br />

of this study which, in effect, is an application of the Koopmans-Hitchcock<br />

model will conclude the chapter.<br />

The first paper to be considered is by Benishay and Whitaker, who<br />

were concerned with estimation of national demand functions <strong>for</strong> rail,<br />

motor and water transport. 11 In particular they desired to estimate the<br />

direct or "own" price elasticity of demand <strong>for</strong> transport of each mode.<br />

By estimating a separate demand function <strong>for</strong> each of the modes and en-<br />

tering only one price or rate variable in each equation, that pertaining<br />

11. H. Benishay, and G. R. Whitaker, Jr., Demand and Supply in Freight<br />

Transportation, The Transportation Center, Northwestern Univ., 1965.<br />

13

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