Explaining Truck Rate Variations for Produce Shipped to the Northeast

Abstract

Models are developed to examine the determinants of weekly truck rates for produce shipped to the Northeast from California and Florida. In the empirical work, a large proportion of the variation in rates is explained and the estimated parameters are generally consistent with a priori expectations. The total quantity of produce shipped from each state, the proportion of this total which is compatible with the commodity in question, and the F.O.B. price if the commodity were found to be the most important determinants of truck rate levels. Fuel costs have a surprisingly weak influence, at least in the short run, and for Florida origin commodities the truck rate-fuel cost relationship appears to have weakened over the 1979–1983 sample period.