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Resources used:
·OCR A2 Economics by Colin Bamford, Susan Grant and Stephen Walton
·Tutor2U Transport Economics Course Companion 2005 Edition
· Heinemann Economics AS and A2 for OCR by Susan Grant and Chris
Transport, transport trends and the
Jade…read more

Slide 2

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A definition of transport
Transport is the movement of goods and people for personal and
business reasons.
The mode of transport used ­ Means of transport, basically road,
rail, air and sea transport.
Passenger transport ­ the movement of people over a distance
and is measured either in terms of passenger kilometres travelled
or number of journeys.
Freight transport ­ the movement of raw materials, components
or finished products between one destination and another and is
measured either in terms of tonne kilometres travelled or number
of journeys.…read more

Slide 3

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Public transport is usually associated with mass transport i.e.
moving large numbers of people by rail, coach or bus.
Private transport involves moving individuals or small
groups by car, taxi etc that is not open to members of the
general public.
Transport operations ­ making a decision about which
mode of transport is best for the user.
Loading ­ refers to the percentage of capacity utilised in a
journey. E.g. A loading factor of 80% means 20% of
seats/space is unused in a given journey.
Peaking ­ occurs when demand exceeds supply on a given
network at a given time period causing congestion e.g rush
hours and bank holidays.…read more

Slide 4

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The demand for transport is derived
Travel is mostly demanded to meet some other
purpose, e.g move products to markets (distribution) or
to enable commuting.
Transport generates externalities causing market failure
because the price of transport does not always reflect
the full social cost to society. E.g. noise pollution and
congestion not paid for by travellers.
Many journeys are INDIVISIBLE. E.g. a journey by car
can is for 1 or 4 passengers. Capacity is not always being
utilised!!…read more

Slide 5

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The infrastructure, which is anything that provides for the
operation of transport. This includes roads, motorways, flight
paths and rail tracks.
Two categories of transport infrastructure:
Transport network ­ roads, railways etc
Transport nodes/terminals ­ where journeys begin or end.
E.g. Airports, bus stations etc.
Infrastructure is built up overtime by investment. Improving
infrastructure requires significant lead times: transport
projects takes 5-30 years to pan and build e.g rail and
A key issue to improving transport networks is funding ­
investment in infrastructure requires huge investment.
Funds must be borrowed, raised in tax or secured from the
private sector e.g through the Public Funding Initiative.…read more

Slide 6

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A better transport system can:
Improve the mobility of labour: workers can live many
miles from work and commute.
Creates significant positive externalities and can be an
initial stimulus to regional economic development. For
example, roads open up market and employment
opportunities, to the benefit of third parties such as
local businesses and workers.
Improves UK competitiveness: efficient transport
systems minimise travel times and so lower domestic
unit costs.…read more

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