Section 6: Conclusions
This study estimates MFP in truck transportation,
over 1987-2003; compares truck MFP to that of
other transportation industries and the U.S. private
business sector; and assesses the factors that
affected changes in truck MFP over time.
With regard to estimation, the calculations are
based on two methodological approaches to estimate
MFP: 1) the methodology using the basic
growth-accounting approach; and 2) the more
complex Tornqvist index approach. With respect
to the results, the MFP calculations based on the
basic growth accounting methodology, and without
land, can be divided into three time subperiods:
1987-1995, 1995-2001, and 2001-2003. During the
first subperiod (1987-1995), truck
MFP increased; during the second subperiod, truck
MFP decreased; and during the third subperiod,
(2001-2003), truck MFP again increased. With
respect to MFP calculations using the Tornqvist
methodology, and without land, the MFP growth
numbers are very similar to, and the trend is the
same as, those of the basic growth accounting
methodology. That implies that either method can
be used to provide appropriate estimates of MFP.
When MFP calculations use the Tornqvist index
and include a measurement for the land input
(similar to the method of BLS), the results of
truck MFP are very similar to those noted above
(obtained by either the basic growth-accounting
methodology or the Tornqvist index). However,
the measurement of land was not direct; it was
related to changes of the stock of structures. In future
work of BTS, land will be measured by other
methods.
According to the MFP results, truck MFP increased
at an annual rate of 0.8% over the whole
period of analysis. With regard to the subperiods,
truck MFP increased at an annual rate of 2.0%
during 1987-1995; it decreased at –0.8% annually
during 1995-2001; and it increased again during
the most recent 2001-2003 period, at 1.1% per
annum.
With regard to MFP comparisons, MFP in
trucking is compared with that of the U.S. private
business sector and the air transportation and
train transportation subsectors. All series cover
the period 1987 to 1999; so, MFP growth rates
can be compared over that period. During that period,
truck MFP and air MFP increased at similar
annual rates each, of 1.2% and 1.3% respectively,
while rail MFP increased at the highest annual
rate of 3.3%. All three transportation industries
experienced growth rates of MFP that were higher
than those of the U.S. business sector of 0.9% per
annum.
In addition, during 1987-1995, truck MFP increased
at a faster rate, of 2.0% per annum, than
air MFP, which grew at 1.2% annually. During
this time period, truck MFP also grew at a substantially
higher rate than that of the U.S. economy
(of 0.6%). Also, truck MFP reached higher
levels than air MFP for most years of the period
of analysis. In 1999, however, this situation was
reversed and maintained until 2001.
Truck MFP was at a higher level than that of
the U.S. business sector for virtually every year
over the period of 1987-2002. Consequently, over
this time period, truck MFP contributed positively
to increases in multifactor productivity of the U.S.
economy. Only during 2001 and 2002 did the
level of truck MFP fall slightly below that of the
U.S. business sector.
With regard to factors affecting truck MFP,
the analysis of truck MFP was also segmented
into three periods: 1987-1995, 1995-2001, and
2001-2003. During the first period—1987 to
1995—truck MFP increased; during the second
period—1995 to 2001—truck MFP decreased;
and during the third period—2002 to 2003—truck
MFP increased again.
Table 14 presents the various factors which
affected truck MFP and indicates the directional
impact of these factors on truck MFP, by a plus (+)
or minus (-) sign. For example, a plus sign would
mean that the factor impacts MFP in a positive
way during that period, whereas, a minus sign
impacts the MFP in a negative way.
The increase in truck MFP during 1987-1995
would seem to have been affected by the following
factors: 1) The relatively high increase in
capital per worker, including a rapid increase in
the use of computers and computer software; this
would have contributed to improvements in the
quality of capital; 2) An improvement in the fuel
efficiency of truck engines that was a result of improvement
in the quality of capital; 3) An increase
in the average length of haul; 4) An increasing use
of containers in truck transportation; and 5) The
positive impacts on industry efficiency as a result
of interstate deregulation in 1980, including the
increase in the TL segment of the industry.
In the second subperiod, 1995-2001, there was
a decrease in truck MFP. This would seem to have
been affected by the following factors: 1) The declining
efficiency of utilizing intermediate inputs;
2) A lower growth rate of capital per worker; 3) A
lower growth rate of utilizing containers; 4) The
decrease in industry output in 2001, as a result
of the economic recession that year, and the catastrophic
events of 9/11/2001; 5) State deregulation
of trucking in 1995; this was followed by a period
of adjustment and uncertainty, which appear to
have had a negative impact on truck MFP.
The increasing MFP during the last subperiod
(2001-2003) seems to have been affected by the
following factors: 1) Increased use of computers;
2) Increases in the efficiency of using intermediate
inputs; 3) Increases in the use of containers; and
4) The adjustment of the industry following intrastate
deregulation in 1995, which completed and
made comprehensive the deregulation of truck
transportation.
With regard to the contribution of trucking to
the economy’s multifactor productivity, data show
that over 1978-2000, truck MFP increased at a
higher annual rate than the U.S. business sector.
Consequently, during this period of time, trucking
MFP contributed positively and significantly
to economy MFP increases. Productivity increases
in the U.S. economy over time have contributed
significantly to economic growth and to improvements
in the standard of living in the country.
|