ECONOMETRIC FORECASTING OF RAILWAY FREIGHT DEMAND

This study is concerned with the demand for rail freight transportation in Canada for the period 1958-73. The primary objective is to quantify the impact of macro-economic activity on rail freight demand. Input-output analysis has been used to provide a link between the macro-economic variables and the transportation sector. The coefficients in the input-output tables have been used to translate information on the expenditure components of Gross National Expenditure into commodity outputs. These commodity outputs are in turn related to freight movements by commodity, in the framework of a rail model. The rail model attempts to characterize the determinants and interrelations of rail freight demand and supply by commodity in a simultaneous equation framework. The results on both the commodity forecasting and rail model are quite encouraging. The major findings of the study are: (1) Given accurate forecasts of final demand variables, we can predict both the industry and commodity outputs with a small margin of error. (2) Commodity outputs are the major determinants of rail freight demand in volume terms, and in the short run there is a proportional relationship between output and transportation demand. (3) Rail freight demand is price inelastic and the effect of price differs among commodities. (4) For the sample period 1958-73, the complete model was used to measure the combined effect of structural changes as measured by changes in the input-output coefficients, and the compositional changes in final demand over time. The results were a reduction in the growth rate of railway tons and ton-miles by 3 per cent and 6 per cent respectively, and increased revenue growth in real terms by 5 per cent as compared with a hypothetical base under which the structure and composition remain constant.

  • Corporate Authors:

    Canadian Institute of Guided Ground Transport

    Queen's University
    Kingston, Ontario K7L 3N6,   Canada 
  • Authors:
    • Sparks, G R
  • Publication Date: 1978-12

Media Info

  • Features: Figures; References; Tables;
  • Pagination: 62 p.

Subject/Index Terms

Filing Info

  • Accession Number: 00195069
  • Record Type: Publication
  • Source Agency: Canadian Institute of Guided Ground Transport
  • Report/Paper Numbers: CIGGT Rpt 78-4 Final Rpt.
  • Files: TRIS
  • Created Date: Jul 31 1979 12:00AM