Information, Decisions, and Productivity: On-Board Computers and Capacity Utilization in Trucking

39 Pages Posted: 4 Oct 2001 Last revised: 3 Feb 2015

Multiple version iconThere are 3 versions of this paper

Date Written: October 2001

Abstract

Productivity reflects not only how efficiently inputs are transformed into outputs, but also how well information is brought to bear on resource allocation decisions. This paper examines this empirically by looking at how on-board computer (OBC) adoption has affected capacity utilization in the trucking industry. Estimates using 1997 data indicate that capacity utilization has increased by an average of 13% among trucks for which advanced OBCs have been adopted. The average benefits to adopters are higher in 1997 than 1992, suggesting lags to the returns to adoption, and are highly skewed across hauls. The 1997 estimates imply that OBC-enabled improvements in communications and resource allocation decisions have led to a 3% increase in capacity utilization in the industry, which translates to billions of dollars of annual benefits. The commercialization of other wireless networking applications has the potential to generate analogous benefits in other contexts.

Suggested Citation

Hubbard, Thomas N., Information, Decisions, and Productivity: On-Board Computers and Capacity Utilization in Trucking (October 2001). NBER Working Paper No. w8525. Available at SSRN: https://ssrn.com/abstract=286197

Thomas N. Hubbard (Contact Author)

Northwestern University - Department of Management & Strategy ( email )

Kellogg School of Management
2001 Sheridan Road
Evanston, IL 60208
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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