The case for and against value-of-service pricing is discussed. While demand pricing is seen by some as resulting in subsidies to some commodities and resulting in misallocation of resources, cost-oriented rates involve cost allocations of prodigious complexity in the transport industries. Demand pricing is seen as one means of allocating fixed costs on a "value received" basis and assuring that the plant is used more efficiently. Value-of-service pricing makes possible service to marginal locations with rates representing an indirect subsidy. While commodity rates do not ignore a commodity's value, they are more cost-oriented than class rates. Additional research is needed in the area of traffic, volume and rates charged.

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  • Corporate Authors:

    American Society of Traffic and Transportation

    547 West Jackson Boulevard
    Chicago, IL  United States  60606
  • Authors:
    • Davis, G M
    • Combs, L J
  • Publication Date: 1975

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Filing Info

  • Accession Number: 00095286
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jul 15 1975 12:00AM