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A Message from the JTRF Co-General Editors
The Summer 2007 issue contains the usual wide variety of transportation topics that has become the trademark of JTRF. Topical areas include:
- Allocating highway costs among truck types
- Ohio River transport of grain
- Evaluation of traffic assignment computer packages
- Determinants of air traffic performance
- Forecasting air carrier insolvency
- Pre-departure changes in airline prices
- Corporate governance transparency in global airline strategic alliances
- Reform of U.S.-Canada border trucking
In "A New Approach for Allocating Highway Costs," Feng Hong, Jorge Prozzi, and Jolanda Prozzi discuss the shortcomings of the ESAL (equivalent single axle load) method of allocating pavement damage among the various vehicle classes. They propose an innovative highway cost allocation approach based on the recently completed Mechanistic-Empirical Design Guide of New and Rehabilitated Pavement Structures developed under NCHRP Project 1-37A. The authors found that the cost share of heavy trucks decreases as the thickness of the surface layer increases, while the light trucks' share increases. They also discovered that five-axle single trailer trucks (i.e., 18-wheelers) contribute more than 80% of the pavement damage cost attributable to trucks, and all the other remaining 11 truck classes' cost share is less than 5% each.
Michael W. Babcock and Stephen W. Fuller investigate the determinants of waterborne corn and soybean shipments in "A Model of Corn and Soybean Shipments on the Ohio River." Using monthly data of the 1992-2004 time period, they estimate an econometric model in which corn and soybean shipments on the Ohio River are made a function of lower Ohio River grain barge rates; corn and soybean stocks in the states of Indiana, Ohio, and Kentucky; corn and soybean inspections for export at lower Mississippi River Gulf Ports; average Indiana corn price; and ocean freight rates from lower Mississippi River Gulf Ports to Japan. Babcock and Fuller found that Ohio River corn and soybean shipments are significantly and positively related to one-month-lagged shipments, corn and soybean stocks, and corn and soybean exports. Ocean freight rates were negatively related to the dependent variable.
In "A Review of Dynamic Traffic Assignment Computer Packages," Mansoureh Jeihani describes demand estimation, supply presentation, methods for computing dynamic user equilibria, and convergence of some well known computer packages, with emphasis on TRANSIMS. Jeihani concluded that unlike other computer packages that require origin-destination demand as an input, TRANSIMS estimates and predicts time-dependent demand. He also found that it treats individuals in a disaggregated fashion and it is multi-modal. Its traffic assignment supports route choice, mode choice, and departure choice.
Dipasis Bhadra develops an empirical framework to examine the determinants of air traffic performance (ratio of airborne time to total ramp-to-ramp time) in "Air Traffic Performance by Market Segments." He used quarterly air segment traffic data for the 1995-2006 period to construct an econometric model to estimate air traffic performance measures defined over market segments and three types of networks. He found that the model worked particularly well for hub-to-hub and hub-to-spoke networks. Bhadra concluded that busy times of the year (spring and summer) affect air traffic performance negatively for two of the three types of network. Other findings were that market size positively influences performance for hub-to-hub networks and negatively for the other two networks. Other variables found to have an influence on performance were distance, presence of Southwest Airlines in the market, and aircraft size.
In "Deriving Rules for Forecasting Air Carrier Financial Stress and Solvency: A Genetic Algorithm Approach," Sergio Davalos, Richard D. Gritta, and Bahram Adrangi explore the use of the Genetic Algorithm (GA) to assess the solvency of 19 U.S. air carriers. The authors point out the problems of other methods for forecasting insolvency. These include limitations in terms of generalization, requiring linearly separable variables, lack of transparency, inconsistent results, and convergence to a local optimum. According to the authors, the GA approach doesn't have these limitations. They use the GA method to forecast solvency of U.S. airlines and achieve an overall accuracy of 94%.
Kenneth Button and Henry Vega examine the use of Internet airfare booking data to develop a profile of airfares that are offered for a particular flight as the time of departure approaches in "The Uses of the "Temporal-Fares-Offered Curve" in Air Transportation." The authors review the empirical work that has been done using this type of data and synthesize the information and insights that it can provide on the operation of an airline market. They examine a variety of subjects including pricing strategies of low-cost and legacy carriers under different degrees of competition, the extent to which there is price leadership in markets, and the ways in which airlines determine fares-offered when their own services effectively compete with each other. Button and Vega found that the forms of temporal-fares-offered curves are highly sensitive to the prevailing market structure. They concluded that the number of airlines in the market and the business models they employ have an impact on the fare time path.
In "Cross-Cultural Factors and Corporate Governance Transparency in Global Airline Strategic Alliances," Catherine C. Giapponi and Carl A. Scheraga examine the effect of corporate transparency on the benefits of airline alliances. They also investigate the impact of national culture on governance transparency. National culture is described by Hofstede's five dimensions of power distance, uncertainty avoidance, individualism, masculinity, and temporal orientation. Giapponi and Scheraga examine governance transparency of three major airline alliances (Star, oneworld, and Sky Team) using corporate annual reports. They found that the intensity of governance disclosure varies across alliances and within each alliance as well as across national borders. They also discovered that national culture impacts corporate governance disclosure in the airline industry.
Richard Beilock and Barry E. Prentice propose a limited experiment in North American motor carrier cabotage in "A Single North American Trucking Market Experiment: The Open Prairies Proposal." The proposal would allow cabotage for U.S. and Canadian motor carriers throughout the Prairie Provinces of Canada and several Upper Great Plains U.S. states. The plan would include a sunset provision to require both nations to reaffirm the experiment after a specified time period. Beilock and Prentice discuss seven variants of their cabotage plan that have different rules regarding permissible cabotage depending on the previous international movement and origin or destination in the Open Prairies area. They also discuss the likely costs and benefits of their proposal.
Michael W. Babcock
Co-General Editor - JTRF
Kofi Obeng
Co-General Editor - JTRF
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