RECENT PAPERS

            Train, Kenneth, and Wesley W. Wilson.  2009. "Monte Carlo Analysis of RP-SP Data" Journal of Choice Modeling (Forthcoming, 2009) 

 

Abstract:  SP-off-RP questions are a recent innovation in choice modeling that solicits information from respondents in a different way than standard stated-preference (SP) experiments.  In particular, the alternatives and choice of a respondent in a real-world setting are observed, and the respondent is asked whether he/she would choose the same alternative or switch to another alternative if the attributes of the chosen alternative were less desirable in ways specified by the researcher and/or the attributes of nonchosen alternatives were more desirable in specified ways. This construction, called “stated-preference off revealed-preference” (SP-off-RP), is intended to increase the realism of the stated-preference task, relative to standard SP exercises, but creates endogeneity.  In this paper, we present a series of Monte Carlo exercises that explore estimation on this type of data, using an estimator that accounts for the endogeneity.  The results indicate that, when the variance in the processing error by respondents is the same for SP-off-RP data as for standard SP data, the two solicitation methods provide about the same level of efficiency in estimation, even though the SP-off-RP data contain endogeneity that the estimator must handle while the SP data do not involve endogeneity.  For both solicitation methods, efficiency rises, as expected, as the variance of the processing error decreases.  These results imply that, if respondents are able to answer SP-off-RP questions more accurately than standard SP questions (and hence have lower variance of processing error), then SP-off-RP data are more efficient that standard SP data. This implication needs to be viewed cautiously, since (i) the actual processing error for each solicitation method is not measured in the current study, and (ii) the results are for the specific data generation processes that are used in the Monte Carlo exercises.

            Train, Kenneth, and Wesley W. Wilson, "Transportation Demand and Volume Sensitivity: A Study of Grain Shippers in the Upper Mississippi River Valley," Transportation

Research Record (2008). 

 

Abstract:  Transportation demands typically involve a mode and a volume decision.  This paper focuses on the volume decision and the adjustments of volume to changes in rates, transit times and reliability.  Demanders are confronted with a change in each of these attributes and state whether their volumes would change or not, and if they would change, by how much.   The model is estimated using Heckman’s (1) procedure.  In the first stage, the probability of whether or not an adjustment occurs is estimated as a function of firm attributes, and in the second stage, the level of adjustment is estimated.  The data consist of a recent (2006) survey of grain shippers in the Upper Mississippi and Illinois River Valleys.  The results suggest that whether or not an adjustment occurs is affected by storage capacity and rail car loading capacity.  The magnitude of the adjustment, given it occurs, is driven by the magnitude of the change in rates, time, and reliability.  The estimates imply moderate elasticities with respect to rate changes and smaller elasticities with respect to time and reliability.  To capture the effects of spatial competition amongst elevators, two different types of rate changes were considered.  These are rate changes that apply only to the shipper and not its competitors and rate changes to apply to both the shipper and its competitors.  As expected, the former tends to have a larger effect than the latter.

Wilson, William W. , Wesley W. Wilson, and Bruce Dahl.  2008. "Protein and the Demand for Hard Wheat", Australian Journal of Agricultural and Resource Economics.  Vol. 53, pp.  285-303.

 

 

Abstract:  Wheat protein is one of the most important specifications used in domestic and import purchase contracts and is used partly as a proxy for functional quality.  The purpose of this article is to analyze the demand for wheat delineated by protein class.  A choice-based econometric model is specified and estimated using a novel data set of pooled wheat shipments to individual importing countries.  Buyers are importing countries who make purchase decisions among different protein levels.  The model frames the choice in terms of attributes of the choice and of the importing countries.  Results indicate that there have been shifts over time, and purchase probabilities are highly price elastic and vary across importing regions.  Functional characteristics including wet gluten content and extraction rates have significant impacts on purchase probabilities.  These results have implications for breeders as it clearly illustrates the role of protein and functional characteristics on demand.  The results also have implications for analysts modeling wheat trade in that there are many factor impacting market segments that would not be captured in conventional demand specifications. 

Henrickson, Kevin E. and Wesley W. Wilson.  2008.  "Compensation, Unionization and Deregulation in the Motor Carrier Industry, Journal of Law and Economics. Journal of Law and          Economics.  No. 51(1), pp. 153-177. 

 

Abstract: Previous research on the deregulation of the motor carrier industry has concluded that firms have become more efficient under deregulation, and that costs have fallen, largely, at the expense of labor.  Most studies that examine the effects on labor use CPS data and find that wage premiums to union labor have fallen as a result of deregulation.  This study uses firm data and finds that deregulation had a very small effect on the average compensation paid by surviving union firms.  For non-union firms, the impact of deregulation is much larger.  These results suggest that compensation premium for the labor of surviving union firms has increased, but this increase applies only to surviving union labor.  In the paper, we also point to and note a major exodus of union firms with the result that union labor levels have fallen and fallen dramatically.

 Anderson, Simon P., and Wesley W. Wilson.  2008 “Spatial Competition, Pricing, and Market Power in Transportation: A Dominant Firm Model.” Journal of Regional Science Vol. 48(2), pp. 367-397.

 

Abstract:  Transport firms compete over space. We develop a dominant firm model of transport services wherein one .rm (the railroad) has market power, but competes in space with a competitive alternative (truck-barge). When constrained, the dominant firm prices to "beat the competition", which impedes efficiency when demand has some elasticity. We extend the basic model in a number of directions that include the relationship between monopoly prices and the generalized concavity of the shipper demand functions, the effects of multiple terminal markets, the role of joint production (fronthaul-backhaul markets), and the effects of capacity constraints.

Train, Kenneth, and Wesley W. Wilson, (2008) “Estimation on Stated-Preference Experiments Constructed from Revealed-Preference Choices" Transportation Research – B, Vol. 42 (2008) , 191-2003.

 

Abstract: Constructing stated-preference (sp) experiments from a choice that the respondent made in a revealed-preference setting can enhance the realism of the sp task and the efficacy of preference revelation. However, the practice creates dependence between the sp attributes and unobserved factors, contrary to the independence assumption that is maintained for standard estimation procedures. We describe a general estimation method that accounts for this non-independence and give specific examples based on standard and mixed logit specifications of utility. We show conditions under which standard estimation methods are consistent despite the non-independence. We illustrate the general methodology through an application to shippers’ choice of route and mode along the Columbia/Snake River system.

Bitzan, John and Wesley W. Wilson. (2007).  "Industry Costs and Consolidation: Efficiency Gains and Mergers in the Railroad Industry,"  Review of Industrial Organization. Vol

30(2), March, 81-105. (Lead Article)

 

Abstract:  Since partial deregulation in 1980, there has been a massive consolidation of firms in the railroad industry premised largely on efficiency gains.  We estimate a cost function and use it to calculate cost effects for specific mergers and for all mergers at the industry level from 1983-2003.  Our central results are that consolidation in the railroad industry accounts for about an 11.4 percent reduction in industry costs (more than $4 Billion), and that while there are tremendous differences across mergers with respect to the direction, level, timing, and source of cost impacts, most result in cost savings.

Blonigen, Bruce B., and Wesley W. Wilson, (2008). “Port Efficiency and Trade Flows,” Review of International Economics, Vol. 16 (February, 2008) No. 1, pp. 21-36.                                                                 

 

Abstract:  Growing international trade and increasing congestion focus attention on trade facilitation. Ocean ports are a central and necessary component in facilitating trade. Yet, there is only limited comprehensive information available on the efficiency of ports, much less evidence of the effect of port efficiency on trade. We develop and apply a straightforward approach to estimate port efficiency. The approach uses detailed data on U.S. imports and associated import costs, yielding estimates across ports, products, and time. These measures are incorporated into a gravity trade model where we estimate that improved port efficiency significantly increases trade volumes.

Henrickson, Kevin E. and Wesley W. Wilson, Compensation, Unionization and Deregulation in the Motor Carrier Industry, Journal of Law and Economics (forthcoming, February, 2008).

 

Abstract:  Previous research on the deregulation of the motor carrier industry has concluded that firms have become more efficient under deregulation and that costs have fallen, largely at the expense of labor. Most studies that examine the effects on labor use Current Population Survey data and find that wage premiums to union labor have fallen as a result of deregulation. This study uses firm data and finds that deregulation had a very small effect on the average compensation paid by surviving union firms. For   nonunion firms, the impact of deregulation is much larger. These results suggest that the compensation premium for the labor of surviving union firms has increased, but this increase applies only to surviving union labor. In the paper, we also point to and note a major exodus of union firms with the result that union labor levels have fallen, and fallen dramatically.

Thoma, Mark A., and Wesley W. Wilson. AMarket Adjustments over Transportation Networks: A Time Series Analysis of Grain Movements on the Mississippi Inland Waterway System, Journal of Transport Economics and Policy, Vol. 40 (May 2006) No. 2, pp. 149-72 (Lead Article).

 

Abstract:  Transport occurs over a network and involves a multitude of different origins, destinations, and modes, which complicates the estimation of structural models. However, an understanding of the type and level of market adjustments among key transport statistics is central to analysing the effects of policy and to forecasting. Time-series techniques are used to characterise the relationship between key transport statistics such as movements on a waterway and shocks to barge rates. Generally, the results suggest that the approach is useful in uncovering complicated relationships over networks and that it is well suited to forecasting.

Train, Kenneth, and Wesley W. Wilson, "Spatially Generated Transportation Demands", in Scott Dennis and Wayne K. Talley eds., Research in Transport Economics: Railroad Economics, Vol 20 (2007), pp. 97-118.

 

Abstract:  Transportation demanders are located at different points in geographical space and have differential access to modes.  Central to the planning considerations is the aggregation of different shippers by mode over space into modal demands.  We estimate a demand model involving the choice between rail and barge.  Not all shippers have direct access to one or both modes and must use truck to access the alternative modes.  The results indicate that the access costs matters significantly as do barge and rail rates and shipper attributes.  The results are then used to derive spatially generated modal demand functions.

Bitzan, John and Wesley W. Wilson, "A Hedonic Cost Function Approach to Estimating Railroad Costs," in Scott Dennis and Wayne K. Talley eds., Research in Transport Economics: Railroad Economics, Vol 20 (2007), pp. 119-152.

 

Abstract:  This study estimates a hedonic railroad cost function. It allows for differences in marginal costs across different outputs with different shipment characteristics. Cost and shipment data are included to examine the elasticity of costs with respect to two outputs – unit train output and way & through train output. We find differences across these two measures, which suggest the use of aggregate output measures may lead to significant bias in   cost elasticities. Moreover, our approach also allows the effects of different shipment characteristics (e.g., shipment size, average length of haul) on marginal cost of each output to be considered.

Burton, Mark, and Wesley W. Wilson, AANetwork Pricing: Service Differentials, Scale Economics, and Vertical Exclusion in Railroad Markets,@ Journal of Transport Economics and        Policy, Vol. 40 (May, 2006) No. 2. pp. 255-77.

            Anderson, Simon P., and Wesley W. Wilson.  2007.  ASpatial Modeling in Transportation,” in Jeremy F. Plant ed.,  Handbook of Transportation Policy and Administration (CRC Press:  Middletown, PA.), pp. 255-280.

            Henrickson, Kevin E., and Wesley W. Wilson.  2007.  AA Description of the Inland Waterway System and Planning Models.@  in Jeremy F. Plant ed.,  Handbook of Transportation Policy      and Administration (CRC Press:  Middletown, PA.), pp. 53-78.

            Wilson, Wesley W.  2006. AVessel, Firm, and Lock Efficiency Measures in Lock Performance,@   Transportation Research Record:  Journal of the Transportation Research Board No.         1963, pp. 1-8 (Lead Article).

            Train, Kenneth, and Wesley W. Wilson.  2006.  ASpatial Demand Decisions in the Pacific Northwest:  Mode Choices and Market Areas.@  Transportation Research Record:  Journal of the Transportation Research Board No. 1963, pp. 9-14.