• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
  6. 6
  7. 7
  8. 8
  9. 9
  10. 10
  11. 11
  12. 12
  13. 13
  14. 14
  15. 15
  16. 16
  17. 17
  18. 18
  19. 19

Transport - The movement of goods and people from one destination to another for a variety of personal and business purposes

Extracts from this document...


TRANSPORT * The movement of goods and people from one destination to another for a variety of personal and business purposes * Measured in tonne/passenger kilometres or number of journeys. * Derived Demand = not demanded for its own sake but for the need to transfer goods or passengers - dependent on the demand for these * Can't be stored or transferred * Affected by peak & off-peak demand (daily & seasonal) * Supply/capital is indivisible - public transport can be at full capacity into an urban area at peak time, but empty on return journey = over supply at off-peak times. * Continuously changing (passengers & freight) * Generates negative externalities * Accounts for 15% of GNP Demand influenced by- * Own price (buying and running) * Price and quality of substitutes * Price of complements * Output * Income (transport in general & particular mode of transport chosen) - travel expenditure increases with income, yet bus & coach fare expenditure decreases with income (inferior goods). * Journey requirements (e.g. employment & personal needs) * Leisure time (increasing = more holidays & further afield) * Changing urban structure (e.g. places of entertainment built out-of-town) * Personal preferences Forecasting Demand for Future Traffic * difficult process as it depends on how the variables affecting demand change over time, & economic growth. * essential for the government who has to decide on the allocation of funds for future development. * important in assessing whether the benefits from an improvement, over its life-time, justify the initial cost - enable a balance to be struck between providing extra capacity before it is needed & the cost of adding to capacity at a later stage. * to predict the environmental impacts of traffic 1952 - 27% of passenger km travelled were by car, taxi, van, & 60% public transport (bus & rail) 2000 - 86% of passenger km travel by car, taxi, van; & only 12% public transport Car Transport Dominates passenger transport (86%) ...read more.


Profits are driven down & this could lead to operators reducing their costs, affecting safety standards. Quantity Licensing - to ensure existing capacity was fully utilized. Cross-subsidization of bus services - off-peak journeys are socially worthwhile but unprofitable, but supported by profits made at peak times. - only possible as long as operators have monopolies (less likely with a deregulated bus industry). Ownership Railways, parts of road haulage & bus sector are under public ownership as it would be easier for the government rather than private companies to subsidise & co-ordinate them. Contestable markets Privatise & deregulate transport markets Increased competition = decrease in price No supernormal profits Must be efficient to keep franchise e.g. only one train company may operate a route but the market can be made contestable by selling it a short-term franchise which will only be renewed if the service it provides is of a better quality and lower price than that which could be offered by other companies. e.g. bus service - if profits rise on a particular route bus companies operating on other routes may switch some of their fleet to the profitable route. Consumers may reap double benefits from contestable markets. They may be able to benefit from the lower costs which a sole firm can gain because of economies of scale while also benefiting from the absence of supernormal profits because of the possibility of entry of competitors into the market. Mergers may reduce the number of potential competitors, restrictive practices may occur & consumers may not benefit if there are significant negative externalities. Sustainable Transport Policy * Meets the current needs of people & firms without threatening the environment & the ability to meet the transport needs of future generations. * Takes into account social costs & benefits (wants to make the social costs of transport equal to private costs) * Discourages the use of the car & promotes other environmentally friendly modes of transport * Co-ordinated with a range of other policies, including health, education, environment & land use planning. ...read more.


Inefficient - leads to higher costs & fares in some areas, yet lower costs in other area, though not passed onto passengers through lower fares. VED is an annual charge that has to be paid by all vehicles using the public highway. Historically it has been set at a flat rate for private cars & at a variable rate for commercial vehicles, depending on their weight. A more sustainable outcome would be to vary the rate of VED depending on the vehicle's engine. Mode Comparison Passengers Freight Mode Advantages Disadvantages Advantages Disadvantages Rail � Fast � Work while travel � Carry a lot of people � Environmentally acceptable � Expensive � Delays � Not door to door � Frequency � Direct � Large capacity � Fast � Additional method needed Private car � Flexible & convenient � Comfort � Door to door � Cheaper than trains � Congestion � Pollution � Fuel prices � Safety Possibly van � Convenient � Door to door � Not much room to carry large amounts � Not environmentally friendly Public bus � Cheap on average cost � Bus lanes � No parking � Not always reliable & comfortable � Congestion � Not necessarily direct � Connection � � Inland waterways � No congestion � Cheap � Environmentally friendly � No tax � SLOW � Large loads � Lower production costs � Cheap � Not a network of canals � SLOW � Additional modes needed Air � Long distances fast � Comfort � Carry reasonable amount � Opportunity cost � Expensive � Limited airports � Time delays � Congestion � Not environmentally friendly � Quick - good for perishables � Expensive � Can't carry huge load � Additional transport needed Sea � Large people carrying � Relatively cheap � Environmentally friendly � Slow � Weather � Large quantity � Fairly cheap � Extra cost via port � Slow 1 ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our GCSE Economy & Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related GCSE Economy & Economics essays

  1. Marked by a teacher

    What happened to the income of taxi drivers, and fares paid by consumers in ...

    4 star(s)

    In this situation, all firms regard themselves as price-takers because each of them owns an insignificant proportion of totally industry supply and they are too small to affect price by changing their supply. Besides, there are no barriers to entry and exit for the firms in the long run.

  2. Labour is a derived demand because the demand for labour is a result of ...

    The wage rates are very important in attracting supply of labour to a particular firm or industry, as the higher the wage rate of a profession, the higher the supply of labour will be to that specific profession. People are more prepared to sacrifice their leisure time and supply their

  1. Airline Industry and Contestability Project - What is a contestable market?

    The rise in major airliners over the last decade suggests that more firms have entered the market and made it more contestable. If you look in the past national flagships such as British Airways and Air France dominated the airline industry. These were state owned and owned by the government.

  2. The structure of the airline industry.

    The estimate to purchase the new security equipment is roughly $6 billion. The current funding sources is said to be somewhere in the neighborhood of $2 billion leaving $4 billion needed from possible sources such as additional fees, grants, passenger facility charges, and/or appropriations.

  1. The Quest for Optimal Asset Allocation Strategies in Integrating Europe.

    So far, we have examined cross-country correlation levels to determine whether diversification among EU national indices could be profitable. However, analysing the evolution of the average correlations across countries and industries index returns may be a rather na�ve analysis. As is argued by Beckers at al (1992), low correlations between different markets may be perfectly consistent with complete integration.

  2. Examine to what extent privatisation of rail service in the UK has achieved its ...

    John Major's conservative government privatised the railway in 1996. The publicly owned British rail was divided into a hundred parts which were sold separately or, otherwise, franchised. This is due to the network basically being split into its several components; track, rolling stock, maintenance and train operating workings.

  1. McDonalds- Just Another Company?

    The work is designed to completely strip employees of their humanity, it is reminiscent of army boot camps where soldiers have to be turned into 'fighting machines'. In both institutions 'why?' is a forbidden question- procedures and orders are their own justification.

  2. Free essay

    Do high house prices in Trafford deter key public sector workers from seeking a ...

    for more usually and the price of houses here on average is quite a bit higher. Some of my friends have had less luck getting a house in Trafford. Combined with my girlfriend's salary only it's just affordable." "I have considered buying a house elsewhere and driving in to the school, but luckily that didn't happen.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work