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Research on Analytical Methods for Policy Performance III
-Development of a Model to Forecast International Freight Flow with a Spatial Economic Approach-

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International freight transport demand is a derived demand which is generated with trade between regions. Therefore, it is general that international freight transport demand forecasting is done in the step of forecasting the amount of trade, then calculating the freight transport volume corresponding to it.

Many of international freight transport demand forecasting models estimate trade coefficients by using time-series data etc., and forecast the amount of international trade based on these trade coefficients. However, the basis of trade coefficients of these models is not theoretically well-supported, and these models cannot describe the rapid change of commercial terms by Free Trade Agreement (FTA) and so on. Moreover, some models which don't introduce transportation costs explicitly cannot estimate the effect of various transportation policies for decreasing transportation costs.

In this research, to deal with these problems we attempt a demand forecasting by applying Spatial Computable General Equilibrium (SCGE) Model, studies of which are developed in the field of international and spatial economics (see Shoven and Whally(1992)). In SCGE Model, activities of economic agents such as households, firms, and governments are formulated according to microeconomic theory, and then market equilibrium is assumed. Therefore, the amount of trade between regions is described as the result of behaviors of households and firms of each region in the state of equilibrium. However, static equilibrium models such as ordinary SCGE Model do not have time concept since they do not consider time before reaching equilibrium, thus they are generally inappropriate for forecasting the demand at a target year. Therefore, in this research, we try to construct demand forecasting model by quasi-dynamic SCGE Model which combines "Equilibrium Model" and "Capital Flow Model" describing capital mobility between regions. The results of scenario analysis by the SCGE model give us much useful information on future transportation policies.


issue

Reports No.71/2006 OCT.

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