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Transport Efficiency and
Sustainability
No matter whether you are a politician, logistics professional and/or a
consumer one could perhaps learn something from the economists
Arthur Cecil Pigou, Ronald Coase, Elinor Ostrom and BARBED WIRE
that actually is related to transport, transport efficiency and
sustainability. Pigou with his theories of taxation as a means to minimize
externalities. Coase with the teorem that postulates smart solutions by
companies through an example including barbed wire and finally Ostrom
that with her research shows that state and market not always need to
be the only solution.




                                                Niklas Arvidsson   2011-10-26   www.handels.gu.se
Content

Background and cooperation

What is transport efficiency?

State

Market

Civil society

Conclusion




                                Niklas Arvidsson   2011-10-26   www.handels.gu.se
Background and cooperation – research project “more
sustainable logistics”

Financed by:
VINNOVA, The Logistics and Transport Society LTS, Volvo Logistics, DB Schenker,
  Stora Enso, Västra Götaland Region, City of Göteborg Traffic Division, Chalmers
  University of Technology and the University of Gothenburg, School of Business,
  Economics and Law.

Cooperation in my part of the project
With almost all stakeholders above and also discussions with Volvo Trucks and
 Scania in “förstudie transporteffektivitet”.

Personally I am in between two articles in my research, repetitive to talk about my
 first article again and too early to talk about the other, thus this “general”
 character of this presentation.




                                                      Niklas Arvidsson   2011-10-26   www.handels.gu.se
Content

Background and cooperation

What is transport efficiency?

State

Market

Civil society

Conclusion




                                Niklas Arvidsson   2011-10-26   www.handels.gu.se
What is transport efficiency?


This is the definition I am working on right now:

“Resource efficiency in movement of goods”

Externalities ≈ (negative) environmental effects

Stakeholders: truck manufacturers, operators, forwarders,
 transport buyers and authorities

Who can influence the most? What do stakeholders say?


                                       Niklas Arvidsson   www.handels.gu.se
Content

Background and cooperation

What is transport efficiency?

State

Market

Civil society

Conclusion




                                Niklas Arvidsson   2011-10-26   www.handels.gu.se
The state as a solution to “resource efficiency in
movement of goods”?

• Pigou

• Tax on externalities to avoid a privatization on profits and
  collectivization of environmental costs.




                                                 Niklas Arvidsson   www.handels.gu.se
Content

Background and cooperation

What is transport efficiency?

State

Market

Civil society

Conclusion




                                Niklas Arvidsson   2011-10-26   www.handels.gu.se
The market and its actors as a solution to “resource
efficiency in movement of goods”?

• Coase
    Example with farmer, cattle owner and barbed wire

    Cap and trade

15-30 % vs. 3-4 %




                                            Niklas Arvidsson   www.handels.gu.se
Content

Background and cooperation

What is transport efficiency?

State

Market

Civil society

Conclusion




                                Niklas Arvidsson   2011-10-26   www.handels.gu.se
The civil society as a solution to “resource efficiency in
movement of goods”?

• Ostrom

Example from interviews: “Should I answer as a citizen or
 professionally?”




                                              Niklas Arvidsson   www.handels.gu.se
Content

Background and cooperation

What is transport efficiency?

State

Market

Civil society

Conclusion




                                Niklas Arvidsson   2011-10-26   www.handels.gu.se
Conclusion

Pigou – a good way to make companies not overuse barbed wire
  (transport) and to put the issue on the agenda.

Coase – companies are good at finding smart solutions but they are not
 equally good at implementing measures that are financially uncertain

Ostrom – we all have to take responsibility, the state and the market are
 not the only solution, and this we can?

15-30 % vs. 3-4 %

But who will start?




                                               Niklas Arvidsson         www.handels.gu.se
Conclusion
                                                            Actors
                                                                       Road         Transport Transport
              Transport efficiency*                                   hauliers      providers  buyers               Society
              Driver efficiency                                            +              +              +              +
              Vehicle efficiency                                           +              +              +              +
Increase in   ITS and route efficiency                                    +/-             +              +              +
complexity    Utilization efficiency - Back-haul effect                    +              +              +              +
and number    Utilization efficiency - Load factor                         -              -              +              +
of actors     Packaging efficiency                                         -              -              +              +
              Order efficiency                                             -              -             +/-             +
              Mode efficiency                                              -             +/-            +/-             +
              Regulatory and incentive efficiency                         +/-            +/-            +/-             +
              Coordinated distribution                                    +/-            +/-             +              +
              *(-) cost, (+) benefit
                                                                 Increase in
                                                                 benefit
               Arvidsson, Woxenius & Lammgård (2009) “Options for increasing transport efficiency in urban freight distribution:
               Do more with less” , Logistics Research Network Conference, Cardiff, 16-18 Sep 2009, paper presented and
               published in proceedings.

                                                                      Arvidsson, Lammgård, Woxenius                           www.handels.gu.se
Niklas Arvidsson   www.handels.gu.se
Sammanfattning extra

Jag tror:

När priset ökar på transporter (Pigou), börjar företagen prata transporter
 i styrelserummen och hitta smarta lösningar (Coase) och inte bara
 pratar kapitalbindning, cash flow eller “just in time” (alla tre
 tidsberoende) utan också “just not time” såsom transporteffektivitet
 och börjar ställa hårdare krav på sina transportleverantörer.

Tid är pengar, ja, men är tid lika mkt pengar när räntan är noll? Finns det
  ett litet tidsfönster för möjlighet här och nu? Cashflow?

Kan vi som användare/genererare (Ostrom) av transportsystemet vänta
 en extra dag på vår Iphone?



                                                Niklas Arvidsson         www.handels.gu.se
Externa relationer   2011-10-26   www.handels.gu.se

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Session 37 Niklas Arvidsson

  • 1. Transport Efficiency and Sustainability No matter whether you are a politician, logistics professional and/or a consumer one could perhaps learn something from the economists Arthur Cecil Pigou, Ronald Coase, Elinor Ostrom and BARBED WIRE that actually is related to transport, transport efficiency and sustainability. Pigou with his theories of taxation as a means to minimize externalities. Coase with the teorem that postulates smart solutions by companies through an example including barbed wire and finally Ostrom that with her research shows that state and market not always need to be the only solution. Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 2. Content Background and cooperation What is transport efficiency? State Market Civil society Conclusion Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 3. Background and cooperation – research project “more sustainable logistics” Financed by: VINNOVA, The Logistics and Transport Society LTS, Volvo Logistics, DB Schenker, Stora Enso, Västra Götaland Region, City of Göteborg Traffic Division, Chalmers University of Technology and the University of Gothenburg, School of Business, Economics and Law. Cooperation in my part of the project With almost all stakeholders above and also discussions with Volvo Trucks and Scania in “förstudie transporteffektivitet”. Personally I am in between two articles in my research, repetitive to talk about my first article again and too early to talk about the other, thus this “general” character of this presentation. Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 4. Content Background and cooperation What is transport efficiency? State Market Civil society Conclusion Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 5. What is transport efficiency? This is the definition I am working on right now: “Resource efficiency in movement of goods” Externalities ≈ (negative) environmental effects Stakeholders: truck manufacturers, operators, forwarders, transport buyers and authorities Who can influence the most? What do stakeholders say? Niklas Arvidsson www.handels.gu.se
  • 6. Content Background and cooperation What is transport efficiency? State Market Civil society Conclusion Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 7. The state as a solution to “resource efficiency in movement of goods”? • Pigou • Tax on externalities to avoid a privatization on profits and collectivization of environmental costs. Niklas Arvidsson www.handels.gu.se
  • 8. Content Background and cooperation What is transport efficiency? State Market Civil society Conclusion Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 9. The market and its actors as a solution to “resource efficiency in movement of goods”? • Coase Example with farmer, cattle owner and barbed wire Cap and trade 15-30 % vs. 3-4 % Niklas Arvidsson www.handels.gu.se
  • 10. Content Background and cooperation What is transport efficiency? State Market Civil society Conclusion Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 11. The civil society as a solution to “resource efficiency in movement of goods”? • Ostrom Example from interviews: “Should I answer as a citizen or professionally?” Niklas Arvidsson www.handels.gu.se
  • 12. Content Background and cooperation What is transport efficiency? State Market Civil society Conclusion Niklas Arvidsson 2011-10-26 www.handels.gu.se
  • 13. Conclusion Pigou – a good way to make companies not overuse barbed wire (transport) and to put the issue on the agenda. Coase – companies are good at finding smart solutions but they are not equally good at implementing measures that are financially uncertain Ostrom – we all have to take responsibility, the state and the market are not the only solution, and this we can? 15-30 % vs. 3-4 % But who will start? Niklas Arvidsson www.handels.gu.se
  • 14. Conclusion Actors Road Transport Transport Transport efficiency* hauliers providers buyers Society Driver efficiency + + + + Vehicle efficiency + + + + Increase in ITS and route efficiency +/- + + + complexity Utilization efficiency - Back-haul effect + + + + and number Utilization efficiency - Load factor - - + + of actors Packaging efficiency - - + + Order efficiency - - +/- + Mode efficiency - +/- +/- + Regulatory and incentive efficiency +/- +/- +/- + Coordinated distribution +/- +/- + + *(-) cost, (+) benefit Increase in benefit Arvidsson, Woxenius & Lammgård (2009) “Options for increasing transport efficiency in urban freight distribution: Do more with less” , Logistics Research Network Conference, Cardiff, 16-18 Sep 2009, paper presented and published in proceedings. Arvidsson, Lammgård, Woxenius www.handels.gu.se
  • 15. Niklas Arvidsson www.handels.gu.se
  • 16. Sammanfattning extra Jag tror: När priset ökar på transporter (Pigou), börjar företagen prata transporter i styrelserummen och hitta smarta lösningar (Coase) och inte bara pratar kapitalbindning, cash flow eller “just in time” (alla tre tidsberoende) utan också “just not time” såsom transporteffektivitet och börjar ställa hårdare krav på sina transportleverantörer. Tid är pengar, ja, men är tid lika mkt pengar när räntan är noll? Finns det ett litet tidsfönster för möjlighet här och nu? Cashflow? Kan vi som användare/genererare (Ostrom) av transportsystemet vänta en extra dag på vår Iphone? Niklas Arvidsson www.handels.gu.se
  • 17. Externa relationer 2011-10-26 www.handels.gu.se

Notas del editor

  1. It transfers cost associated with pollution from the publicto the polluter.
  2. showing that common resources can be successfully managed without government regulation or privatization
  3. Do you remember that I told you we asked all the actors in the logistics system who they thought could affect the most in a more sustainable direction?Without giving away too much I can tell you that all actors were chosen but no one chose oneself.This could be one piece to the puzzle why very little is happening in terms of transport efficiency implementation.This is another one:
  4. There are a multitude of reasons but we are studying if Economics and the Environment always pair, which is not the case, at least not for all actors.Paradox: 100 percent transport operator vs. 3-4 percent for a transport buyer