Nature or Nurture: Why Do Railroads Carry Greater Freight Share in the United States Than in Europe?

Although the share of freight carried by railroads was similar and declining in both the United States and Europe during the 1950s, the railroads’ share had reached 38% in the United States by 2000 while falling to 8% in Europe. This paper examines the reasons for this difference. The methodology features a step-by-step calculation of how rail transportation volumes in the U.S. would change if the U.S. and Europe had the same transportation volume, the same market share for non-surface modes, the same distribution of shipment distances by commodity and the same commodity mix. The resulting U.S. volume is then contrasted with the rail transportation volume that Europe is presently moving. Findings show that almost 83% of the gap in 2000 is probably due to natural or inherent differences, such as geography, shipment distance, and commodity mix. However, 17% of the gap cannot be explained by these inherent differences and is presumably due to public policies, including priority of passenger service, lack of interoperability at borders, service quality and rates, and incentives of the rail operators. If the policy gap were closed, railroads’ share of freight in Europe would increase by approximately 65% (from 8% to 13%). However, the structural differences between Europe and the U.S. make it unlikely that Europe would ever approach the 38% rail share of the United States.

  • Availability:
  • Authors:
    • Vassallo, Jose Manuel
    • Fagan, Mark
  • Publication Date: 2007-3

Language

  • English

Media Info

Subject/Index Terms

Filing Info

  • Accession Number: 01046549
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Apr 12 2007 10:57PM