Towards a modal shift in freight transport? A business logistics analysis of some policy measures

This paper analyses the effectiveness of policy measures aimed at triggering a modal shift in the freight transport market. The analysis is based on the inventory-theoretic framework that studies modal choice from a business logistics viewpoint. The crux of the inventory-theoretic approach lies in the fact that explicit attention is paid to all costs in the supply chain that are affected by the choice of transport mode. After a brief literature review on the inventory-theoretic framework, the framework is used to calculate the market shares of different freight transport modes for a hypothetical transport market. In a second step, the impact of some policy measures on the market shares of the transport modes is calculated. By way of illustration, the analysis is applied to the market for container transport from a seaport to its hinterland. It is shown that a combination of certain policy measures can lead to significant modal shifts from road transport to intermodal transport.