Office of Operations Freight Management and Operations

Freight Benefit/Cost Study: Capturing the Full Benefits of Freight Transportation Improvements: A Non-Technical Review of Linkages and the Benefit-Cost Analysis Framework

Final Report

May 11, 2001

Presented to:
Federal Highway Administration
Office of Freight Management and Operations
Attn: Ms. Kate Quinn

Presented by the AECOM Team:
ICF Consulting
HLB Decision Economies
Louis Berger Group

Table of Contents

1 Introduction
2 Illustration of Linkages
2.1 The Business World's View of Logistics: Trends and Developments
2.2 Case Histories of Logistics Reorganizations
2.2.1 Polaroid
2.2.2 Dell Computer
2.2.3 Ford Motor Company
2.3 Summary
3 Framework for Economic Analysis
4 Estimating Quantitative Values for Benefits
5 Summary and Next Steps
Appendix A More on Consumers' Surplus

List of Exhibits

Exhibit 1 Transportation and the Economy
Exhibit 2 How Do Firms React to Improvements in Freight Transportation?
Exhibit 3 Demand Curve for Transportation
Exhibit 4 Consumer Surplus for Transportation

List of Tables

Table 1 Effects of Improved Freight Transportation

Office of Operations