Commodity Distribution Model Incorporating Spatial Interactions for Urban Freight Movement

Abstract

The commodity distribution model proposed in this paper is developed in such a way that the movement of commodities is explained as an outcome of their flow through several freight agents in a supply chain. As commodity flow is fundamentally determined by demand, the proposed model was developed from a discrete choice model that considered the individual behavior of a customer to decide the suppliers from which to purchase and the amount of commodity to acquire from each of them. The model not only takes into account the interplay between shipper and customer in a supply chain but also captures the spatial interactions among alternatives and among customers, because spatial effects generally affect customer preference. In this study, several model specifications were developed and compared, with and without incorporating spatial interactions. The empirical results of the model, which were applied to analyze the urban commodity distribution in the Tokyo metropolitan area, indicate that integrating both spatial interactions among alternatives and among customers statistically improves the model's performance.