Transport costs

Question 1

Means of transportation

Answer 1

• water transportation
• railway transport
• road transport
• air transport

-> development of transportation networks leads to industrialisation and urbanisation (‘cumulative causation’)

Question 2

Phenomenon of cost-space and time-space convergence

Answer 2

Progressive reduction in travel costs and travel time influences locations

Question 3

Components of transport costs

Answer 3

• terminal costs: independent from distance (water > air > rail > truck)
• line-haul costs: function of distance (air > truck > rail > water)

Question 4

Demand elasticity for transport

Answer 4

• perishable goods are more elastic to cost of transport compared to non-perishable goods
  (i. e. goods with high value per unit and/or perishable goods are able to bear higher transportation costs)

Question 5

Determinants of cost of transport

Answer 5

• distance
• alternative modes of transport
• return empty or not
• regime that governs mode of transport (e.g. aviation -> governments; shipping -> shipping corporations)

Question 6

Role of telecommunication for transport

Answer 6

• transport of information is equally essential for economic development as goods transport
• some activities could disperse (routine activities), while others (face-to-face, non-routine) become more concentrated
• > telecommunication is necessary but not sufficient for economic growth