Abstract
Qualitative evidence is presented to contend that the predominant response of waterway grain shippers on the Upper Mississippi River-Illinois Waterway to increases in barge shipping costs is most likely to be modal shift. Even so, modal shift faces serious constraints, moderating its ability to substitute for barges as waterway shipping costs rise. In addition, empirically derived estimates of demand price elasticities for barge transport are offered on four reaches of the river system. The elasticities are moderately inelastic, ranging from −0.7 to −0.3.
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