Transport and the location of foreign logistics firms: The Chinese experience

Based on conditional logit models and recent census data, this paper attempts to study the influence of transport and other factors on the location of foreign logistics firms across Chinese cities. The results suggested that the location of foreign logistics firms depended on transport conditions in terms of roadway, railway and waterway, as well as market size, labor quality, agglomeration economies and government incentives. The importance of transport was found to vary with some firm-specific characteristics. Provincial roadway transport was more important for independent logistics firms and overseas Chinese firms compared to their counterparts. New logistics establishments were more sensitive to roadway transport infrastructure than mature firms. The implications for policy-makers are given in the end.     

The private and social cost efficiency of port hinterland container distribution through a regional logistics system

Increasingly, the debate on freight transport and logistics involves the challenge of sustainable development. Key objectives of sustainable or “green” freight logistics systems are the mitigation of negative environmental and human health effects of distribution operations and the realization of a major modal shift in transport preferences, while at the same time achieving internal generalized cost efficiency and quality of services. Pursuing these goals requires the introduction of a range of measures. These measures call for private and public actors to take up various initiatives and adopt policies. Usually, it is more effective to combine different actions into an integrated package of measures than to introduce single instruments in isolation.This article explores the nexus between sustainability and port hinterland container logistics. In particular, the methodology and results of an empirical analysis based on applications of a network programming tool called the “interport model” are presented and discussed. The model enables an examination of all possible effects on inland container flows and their associated internal and external costs due to public and private initiatives in the field of port hinterland container logistics. The empirical analysis aims to evaluate the impact of a set of simultaneous policy options and operational measures on the competitiveness and sustainability of hinterland multimodal distribution of import and export containers handled at the seaports of the Campania region located in Southern Italy. The loading units can transit through the dry port facilities (the so called “interports”) located in the same region and/or through extra regional railway terminals, before reaching their ultimate inland destinations or the seaports. The integrated package of measures simulated by means of the model includes: (i) infrastructure policy, (ii) improvements of rail services, (iii) regulatory changes in terms of customs authorizations and procedures, (iv) removal of technical and legal barriers to fair and non-discriminatory competition in the market of rail traction between regional seaports and interports, (v) new business models integrating container logistics operations between seaports and interports, and (vi) social marginal cost charging of transport operations. Once this package of instruments is introduced, higher private and social cost efficiency of port hinterland container distribution through the investigated regional logistics system can be achieved. For instance, it has been estimated an annual saving of the order of about 12,660 tonnes of CO₂ equivalent emissions from transport corresponding to an external cost reduction of 0.27 million euros from the observed real life situation, whereas the estimated saving in terms of air pollution (CO, NO_x, PM, SO₂, VOC) from transport is approximately 220 tonnes per year corresponding to an external benefit of 1.31 million euros.The most immediate priority appears to be the customs and intermodal logistics integration of seaports and interports by means of full implementation of the “extended gateway” concept as a way to increase the rail share of modal split and improve the overall cost efficiency of the system. In addition, the simultaneous introduction of a social marginal cost charging policy can contribute to make the regional interports a viable solution to expand the hinterland reach of the regional seaport cluster.     

Forecasting Freight Flows

Trade patterns and transport markets are changing as a result of the growth and globalization of international trade, and forecasting future freight flow has to rely on trade forecasts. Forecasting freight flows is critical for matching infrastructure supply to demand and for assessing investment. This article models long-term dynamic physical trade flows and estimates a dynamic panel data model for foreign trade for the EU15 and two countries from the EFTA (European Free Trade Association) 1967–2002. The analysis suggests that a dynamic three-way-effects gravity equation is the best-fitted econometric model. The analysis uses a structural relationship to explain the structure of the exchange of the goods—a relationship that can be used in the year of forecast. This article also provides a new methodology for converting monetary aggregates into quantity aggregates. The resulting commodity growth rates constitute a valuable input to freight models for forecasting future capacity problems.     

Logistics as a driving force for development under the Belt and Road Initiative – the Chinese model for developing countries

ABSTRACT

An important objective of “the Belt and Road Initiative” is to promote the economic growth of countries in the region. China’s successful development experience, proposed in the initial stage of reform, can be summarised as “Looking for development, building the highway first”. This study is the first to evaluate whether logistics infrastructure has indeed contributed to economic growth by employing an error correction model with panel data from 2003 to 2014. In addition, we compare the influence levels of different sectors of logistics infrastructure in different regions, i.e. developed and developing regions. We focus on developing regions as they represent good development experiences for developing countries in the Silk Road Economic Belt. For developing regions, we find that the most influential factors are telecommunication and airway transportation, which should be the foci of attention in order to promote economic growth and reduce inter-region economic inequalities. The research confirms that logistics is indeed a driving force for economic growth in China, and that the contributions of specific sectors can be a useful reference for developing countries to determine prioritisation of investment in different logistics sectors across regions.     

Incorporating Logistics in Freight Transport Demand Models: State-of-the-Art and Research Opportunities

Freight transport demand is a demand derived from all the activities needed to move goods between locations of production to locations of consumption, including trade, logistics and transportation. A good representation of logistics in freight transport demand models allows us to predict the effects of changes in logistics systems on future transport flows. As such it provides better estimations of the costs of interaction and allows to predict changes in spatial patterns of freight transport flows more accurately. In recent years, the attention for freight modelling has been growing and new research work has appeared aimed at incorporating logistics in freight models. In this paper we review the state of the art in the representation of logistics considerations in freight transport demand models. Our focus is on the service and cost drivers of changes in logistics networks and how these affect freight transport. Our review proceeds along a conceptual framework for modelling that goes beyond the conventional 4-step modelling approach. We identify promising areas for freight modelling that have an integrative function within this framework, such as spatial computable general equilibrium models, supply chain choice models and hypernetwork models.     

Assessment of Cross‐Border Spillover Effects of National Transport Infrastructure Plans: An Accessibility Approach

Abstract

Traditional transport infrastructure assessment methodologies rarely include the full range of strategic benefits for the transportation system. One of these benefits is the contribution to cross‐border integration, critical for the European integration process. However, this is a key issue in strategic planning and decision‐making processes, as its inclusion may increase the probability of large‐scale transport infrastructure projects being funded. This paper presents a methodology for the measurement of the contribution of transport infrastructure plans to European integration. The methodology is based on the measurement of the improvement in network efficiency in cross‐border regions of neighbouring countries, via accessibility calculations in a Geographical Information System support. The methodology was tested by applying it to the ambitious road and rail network extensions included in the Spanish Strategic Transport and Infrastructure Plan (PEIT) 2005–2020. The results show significant and important network efficiency improvements of the PEIT outside the Spanish border. For the road mode, while the Spanish average accessibility improvement accounts for 2.6%, average improvements in cross‐border regions of France and Portugal are of 1.8%. And for the rail mode, the corresponding Spanish value is 34.5%, whereas in neighbouring regions it accounts for 20.2%. These results stress the significant importance of this strategic benefit and the consequent need for its inclusion in strategic planning processes. Finally, the paper identifies the potential of the methodology when applied at different administrative levels, such as the local or state levels.     

Evaluating the competitiveness of container ports in Korea and China

Changes in world trade and the shipping environment have created ever-increasing competition between ports in North-east Asia, especially Korea and China. Following intensive state investment in port developments through large-scale projects, Chinese ports now threaten to oust Busan in Korea as the regional hub. To identify and evaluate the competitiveness of major ports in the region, this paper identifies the components influencing their competitiveness and presents a structure for evaluating them. Based on the literature related to port selection and competition, a regional survey of shipping companies and owners employed factor analysis to reveal that port service, hinterland condition, availability, convenience, logistics cost, regional centre and connectivity are the determining factors in these regions.     

A dynamic approach to road freight flows modeling in Spain

This paper presents an innovative approach to analyzing road vehicle freight traffic that uses a dynamic panel data specification derived from a gravity model. This dynamic approach, which has recently been employed in international goods trade models in lieu of the traditional static specification, is applied to the case of Spain using data for the countrys 15 NUTS-3 regions between 1999 and 2009. Using the system general method of moments approach, we obtained significant evidence that the flow of vehicles carrying commodities by road has a strong persistence effect when controlling for unobserved heterogeneity. We also found that the quality of road transport infrastructure has a significant impact on vehicle trips. According to our findings, we suggest that this type of specification be employed in distribution models in which fixed effects and lags of the dependent variable are included to account for unobserved heterogeneity and persistence effects, respectively.     

Accessibility and transport infrastructure improvement assessment: The role of borders and multilateral resistance

The market potential indicator is a commonly used tool in transport planning for evaluating the potential economic effects derived from improvements in transport infrastructures. The general assumption is that exports from a given region will rise with increased accessibility, thus benefiting economic activities. However, the specification of the market potential model is typically very simple and ignores both the impact of competing rivals and the role of international borders, which leads to unrealistic results. Spatial interaction models on bilateral trade have already proved that international trade is affected by multilateral resistance, borders, adjacency, language or currency. Nevertheless, apart from some recent analyses that simply calibrate the distance decay parameter from trade datasets, these variables have hardly been integrated into research on market potential. This paper sets out to demonstrate that more realistic results are obtained by calibrating the distance-decay parameter and introducing the impact of competing rivals and border effects into the market potential formulation. The proposed model is then applied to the assessment of the accessibility impacts of new road transport infrastructure in the European Union between 2001 and 2012, which shows that the greatest improvements in accessibility were experienced by peripheral countries with high road infrastructure investment.     

A spatial autoregressive panel model to analyze road network spillovers on production

The production function approach is used to introduce the effect of public infrastructure on economic growth focusing on its spillover effects. We improve the existing literature both from a conceptual and methodological perspective. As regressors we incorporate variables related to the new concepts of internal and imported transport infrastructure capital stocks, which are actually used in commercial flows, calculated by network analysis performed in GIS. The internally used capital stock represents own infrastructure that benefits accessing markets within the region itself, while the imported capital stock captures the spillover effect associated to the use of the infrastructure situated in neighboring regions. From a methodological perspective, we introduce spatial interdependence into these models, applying the most recent spatial econometric techniques based on instrumental variables estimation in spatial autoregressive panel models in comparison with Maximum Likelihood estimation methods. We illustrate the methodology with Spanish provincial panel data for the period 1980–2007. Results support the hypothesis that the imported capital has a positive spillover effect on production.     

International logistics in Lithuania at a time of transition

This paper examines the current situation in the largest of the Baltic States - Lithuania - with respect to the development of international transport and logistics in the context of the severe political, economic and social changes that have taken place since 1991. Utilizing statistics previously unavailable for the region, the paper examines the impact of transition and the competitive role of East European carriers upon a specific international movement of electronic goods between Frankfurt/Main in Germany and Vilnius in Lithuania, developing a detailed cost model for the alternative modal choices that are available - road and ship/road. Rail transport is excluded as no international rail services between the two countries are available and there are no plans for such services in the near future. From this, a series of issues for the future in the context of potential EU membership, transport infrastructure developments and logistical trends is analysed.     

Promoting Development through Multimodal Freight Transport in Bangladesh

Abstract

Development emanating from international trade and investment in many least‐developed economies is impeded by inland freight transport systems that restrict multimodal transport. Increasing international trade may raise gross domestic product, generating increased demand for internal containerized cargo movements, but the requisite transport infrastructure is lacking. The paper explores impediments to developing effective multimodal transport and possible solutions in Bangladesh, which is an extreme case in point. It reports applications of Delphi techniques that explored local expert opinions regarding policies required to tackle such impediments. A panel of corporate executives perceived a changing inland transport system poorly suited to efficient origin‐to‐destination cargo movements in international supply chains. To promote further development, customs procedures must be streamlined and Bangladeshi shippers must adopt a door‐to‐door transport system.     

Transport infrastructure and regional economic growth: evidence from China

This article develops a multi-dimensions measurement of transport infrastructure and examines the linkage between transport infrastructure and regional economic growth. A panel data model is estimated using data from a sample of 31 Chinese provinces from 1998 to 2007. The results provide strong evidence that transport infrastructure plays an important role in economic growth. Both land transport and water transport infrastructure have strong and significant impacts, while the contribution of airway transport infrastructure is weak. Furthermore, land transport infrastructure contributes more to economic growth in locations with poor land transport infrastructure, while the investment in water transport infrastructure contribute positively to economic growth only after the investment scale exceeds a threshold level. These results are robust to a variety of alternative methods, the exclusion of possible outliers, and consideration of endogeneity. A retrospective analysis shows that uneven distribution of transport infrastructure is an important reason behind economic disparities across Chinese regions.     

Competitiveness of container terminal operating companies in South Korea and the industry–university–government network

Burgeoning container port facilities have fostered intensified competition among container terminal operating companies (CTOCs). However, despite research into their survival strategies which identified antecedents of competitiveness including hard factors such as facilities, available cargo and cargo processing ability, softer factors spanning human resource management, networks and strategic alliances with universities and government agencies in industry–university–government (I–U–G) networks have been overlooked. This study aims to examine both hard and softer antecedents of competitiveness as perceived by 152 professionals in South Korean CTOCs; empirical relationships among these antecedents, I–U–G networks, and competitiveness itself; and the significance of the I–U–G network in establishing and improving competitiveness. Posited antecedents of competitiveness included human resources, facilities, service quality, customer orientation, reputation, and government support policy as independent variables; the I–U–G network as a moderating variable; and competitiveness as a dependent variable. Empirical structural relationships revealed that excepting government support policy, each variable significantly affected CTOC competitiveness. Further, the I–U–G network moderated the relationships between the antecedents of competitiveness and competitiveness. Because an effective I–U–G network was pivotal in controlling CTOC competitiveness, improved competitiveness requires not only differentiation of human resources, facilities, service quality, customer orientation, and reputation factors but also I–U–G network developments.     

Evaluation of pedestrian crosswalk level of service (LOS) in perspective of type of land-use

In India pedestrians usually cross the road at mid-block crosswalks due to ease of access to their destination or the development of adjacent land use types such as shopping, business areas, school and residential areas. The behaviour of pedestrian will change with respect to different land use type and this change in behaviour of pedestrian further reflects change in perceived level of service (LOS). So, it is important to evaluate the quality of service of such crossing facilities with respect to different land-use type under mixed traffic conditions. In this framework, pedestrian perceived LOS were collected with respect to different land-use type such as shopping, residential and business areas. The ordered probit (OP) model was developed by using NLOGIT software package, with number of vehicles encountered, road crossing difficulty as well as safety considered as primary factors along with pedestrian individual factors (gender and age), land-use type and roadway geometry. From the model results, it has been concluded that perceived safety, crossing difficulty, land-use condition, number of vehicles encountered, median width and number of lanes have significant effect on pedestrian perceived LOS at unprotected (un-signalized) mid-block crosswalks in mixed traffic scenario. The inferences of these results highlights the importance of land use planning in designing a new set of pedestrian access facilities for unprotected mid-block crosswalks under mixed traffic conditions. Also the study results would be useful for evaluating pedestrian accessibility taking into account different land-use type and planning required degree of segregation with vehicular movement at unprotected mid-block crosswalk locations.     

How the environmental impact affects the design of logistics networks based on cost minimization

The degree of centralization of the logistics network is one of the important strategic decisions to take. This issue has often been studied but mainly from a cost minimization focus. This research studies the influence of incorporating the environmental impact in logistics network design models, comparing the results with those obtained considering cost minimization only. A fuzzy biobjective optimization model is used to carry out a number of experiments. By weighting the relative importance of the two objectives, the differences with respect to the base cost minimization solution can be ascertained. Our results show that in general more material is moved through warehouses when the environmental impact is considered and more decentralized facilities are opened.     

Influence of 3D printing on transport: a theory and experts judgment based conceptual model

Consumer 3D printing is on the rise and has the potential to significantly change the transport and logistics sector. Current literature on 3D printing and transport studies does not provide a systematic model of the impact of 3D printing on transport and related (policy relevant) areas, such as traffic safety, location decisions, accessibility and environmental effects. Based on a literature review and two rounds of expert consultation, we propose and refine a conceptual model as a way to approach this gap in the literature. The expert consultation yields that the conceptual model comprises the relevant and important elements for assessing the impact of 3D printing on transport and transport-related challenges. Location, needs and transport resistance are important: (a) city-level hubs are the most likely locations for 3D printers because they can coordinate material flows and gather expertise; (b) mass-individualisation and personification dictates the needs for 3D printers; (c) distribution networks will be organised more efficiently, less empty vehicles, but raw materials still need shipping. However, experts’ opinions diverged on the impact of 3D printing on transport volumes and environmental impacts.     

The spatial productivity of transportation infrastructure

Transportation infrastructure services may cause an impact on the economy of the region in which they are located and, additionally, they are likely to have an impact on other regions. This effect has been labeled the spillover effect. In this study, the existence of direct and spillover effects of road, railway, airport and seaport infrastructure projects is tested by estimating a production function. Together with this primary objective, two common concerns in the literature are addressed: the lack of theoretical foundations for spatial econometrics models and the likely endogenous relationship between transport infrastructure and economic development. The estimated production function takes the form of a Spatial Durbin Model and is estimated using panel data from the 47 peninsular Spanish provinces by alternatively applying a Maximum Likelihood estimator and Instrumental Variables/Generalized Method of Moments estimators. According to the estimates, road transport infrastructure positively affects the output of the region in which the infrastructure is located and its neighboring provinces, while the remaining modes of transportation projects cause no significant impacts on average.     

Developing Transport Infrastructure in Sub-Saharan Africa through Public–Private Partnerships: Policy Practice and Implications

In contemporary times, Public–Private Partnership (PPP) in transport infrastructure has gained considerable attention in developing regions following its success in the developed countries. However, Sub-Saharan Africa (SSA) is among the developing regions with few transport PPP projects and among the regions with high number of failed projects. Meanwhile the region's transport infrastructure need far exceeds it current provision. This paper therefore aims to examine the project experiences (success and failure factors) of three highly profiled transport PPP projects, namely the Lekki toll road concession project (Nigeria), N4 toll road (South Africa/Mozambique) and Port of Maputo (Mozambique) in order to develop policy measures for effective future implementation. The experiences of the three projects show that transport PPP policy is indeed feasible in SSA. However, to realise its full applicability, proper policy actions and measures must be carefully observed and these include effective and efficient stakeholder management, transparent and competitive tendering process, high participation of local investors, stable macro-economic conditions and strong government commitment and regulatory framework. The projects experiences and policy actions developed are impactful in accelerating transport infrastructure development through PPP approach in SSA. Hence it is hoped that policy-makers and practitioners would be informed on the key strategies to employ in implementing future projects.