TARIFF RATE DETERMINATION UNDER COMMON COST: THE CROSS-SUBSIDIZATION CRITERION IN PRACTICE

This paper presents an analytical and graphical methodology, developed as part of a detailed feasibility study of railway transport of two products (crude oil and liquid natural gas) from two Arctic locations (Prudhoe Bay, Alaska, and the Mackenzie Delta, Northwest Territories) to a single southern destination, for determining the range of product and origin tariff levels under conditions of joint and common costs. Sample tariff ranges, computed to preclude cross-subsidization and to permit a realistic comparison of the railway with other transport modes are presented. The applicability of the methodology to more general circumstances is discussed.

  • Corporate Authors:

    American Institute of Industrial Engineers

    345 East 47th Street
    New York, NY  USA  10017
  • Authors:
    • Lake, R W
    • MacDonald, J A
  • Publication Date: 1978-12

Media Info

Subject/Index Terms

Filing Info

  • Accession Number: 00196374
  • Record Type: Publication
  • Source Agency: Engineering Index
  • Files: TRIS
  • Created Date: Jul 31 1979 12:00AM