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Article
An empirical analysis of Australian freight rail demand
Economic Analysis and Policy
  • Albert Wijeweera, Southern Cross University
  • Hong To, Southern Cross University
  • Michael B Charles, Southern Cross University
Document Type
Article
Publication Date
1-1-2014
Peer Reviewed
Peer-Reviewed
Abstract
The impact of an unannounced shock in freight rate, international trade and business cycle on the non-bulk freight rail demand in Australia is examined by using a VAR model and an annual data set encompassing four decades (1970–2011). Results based on VAR, impulse response functions and variance decompositions suggest that freight rate and the volatility of the Australian dollar are the most dominant determinants. The availability of an alternative mode, such as road, could be attributed to this considerable response to the freight rate. Macroeconomic conditions favourable to bulk freight demand, such as a depreciated Australian dollar, have a similar impact on non-bulk rail freight.
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Citation Information

Wijeweera, A, To, H & Charles, M 2014, 'An empirical analysis of Australian freight rail demand', Economic Analysis and Policy, vol. 44, no. 1, pp. 21-29.

Published version available from:

http://dx.doi.org/10.1016/j.eap.2014.01.001