Freight transport demand revisited: A microeconomic view of multimodal, multicharacteristic service uncertainty and the demand for freight transport

Abstract

This paper provides a unifying framework for micro-based models of freight transport demand. An expected utility of profits model is posed that clarifies the conditions under which a system of equations (continuous) regression model should be used as opposed to the conditions that make a quantal choice model appropriate. The model also indicates the nature of subjective data that is necessary for estimating demand. In general, the conditions that give rise to the appropriate use of a quantal choice model imply that the needed subjective information is completely contained in the subjective probability distributions on the service characteristics; the utility function itself is irrelevant.