ABSTRACT
The trucking industry uses the public roads to move goods between shippers and receivers. In contrast to railroads, which operate on their private trackage, use of the public roads separates vehicle ownership from right of way, allowing multiple carrier operations on a single network1 That provides three important advantages. The fi rst is the public roads’ comprehensive coverage that provides uninterrupted movement between any set of points in the country, even the smallest and most obscure. The railroads’ mobility and point coverage are limited by ownership and by a half century of route consolidation. Although the railroads may grant paid use of their tracks to each other, they still operate within bounded domains, and achieving the public roads’ unifi ed network would require a national rail monopoly. The second advantage is that multiple operations encourage structural diversity in trucking and the ability to serve all places where demand exists. The third advantage is that funding for highway construction provides trucking with a subsidized network.2 Because trucking’s right of way is a public good, capital costs are low and are represented mainly by the trucks themselves. Terminals are an additional capital expense, but only one of trucking’s sectors uses them. Low capital costs mean low fi xed costs and linear rates.
