Urban Distribution Centres and Competition Among Logistics Providers: A Hotelling Approach

35 Pages Posted: 6 Apr 2017

See all articles by Daniele Crotti

Daniele Crotti

Università degli Studi di Genova

Elena Maggi

University of Insubria

Date Written: March 2017

Abstract

In recent years several European municipalities have paired market-based measures with urban distribution centres (UDC) in order to reduce CO2 emissions and make more sustainable urban freight ‡ows. However, UDCs may add reloading costs and extra delivery times which have relevant impact on both urban supply chains and the competition among traditional and UDC-based logistics service providers in terms of service quality and freight rates. By using a duopolistic Hotelling framework, we show that market-based measures and subsidies might be substitutes to enhance the demand for UDC-based providers but public funding can be reduced by improving the quality of UDC services. These results can enlarge the scope for investments in UDC value-adding services in order to decrease private crowding-out effects in the long run.

Keywords: Urban Distribution Centre, City logistics, Sustainable Urban Transport Policy, Hotelling Spatial Competition Model, Market-Based Measures, Public Subsidy

JEL Classification: D43, H23, L13, Q58, R41, R48

Suggested Citation

Crotti, Daniele and Maggi, Elena, Urban Distribution Centres and Competition Among Logistics Providers: A Hotelling Approach (March 2017). FEEM Working Paper No. 17.2017, Available at SSRN: https://ssrn.com/abstract=2947584 or http://dx.doi.org/10.2139/ssrn.2947584

Daniele Crotti (Contact Author)

Università degli Studi di Genova ( email )

Via Vivaldi 5
Genova, 16126
Italy

Elena Maggi

University of Insubria ( email )

Via Ravasi 2
Varese, 21100 21100
Italy

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
48
Abstract Views
748
PlumX Metrics