Transportation Policy and Management: Introduction to the Special Issue

Article excerpt

In an age of globalization, the safe and efficient movement of people and goods is crucial to the prosperity and quality of life of trading nations, such as Canada. The Canadian transportation system carries more than $1 trillion worth of goods every year. Nearly 16% of all personal spending is on transportation.

The transportation industry is constantly adapting to new challenges and the currents of change-continentalism, globalization, environmentalism, urbanization, a more diverse and aging population, and the high technology explosion. Over the last two decades, the transportation industry has undergone dramatic changes in Canada and worldwide. We believe that we are coming to an important crossroads in transportation policy and management. This special issue provides a timely forum to discuss issues and challenges facing the transportation sector. We, the guest editors, are very pleased to present the high quality papers chosen by a rigorous refereeing process in this special transportation issue of CJAS.

A fundamental transformation is taking place in the world of commercial aviation, which is attributable to the disappearance of high-end demand for air travel and the emergence of low cost carriers. Flouris and Walker conduct an empirical investigation of the stock price performance as well as the accounting performance of Northwest, Continental, and Southwest following the 9/11 terrorist attacks. They also analyze how the 9/11 event has impacted the risk component of airlines' stock returns. They find that even in the post-9/11 period, Southwest performed significantly better than Northwest and Continental in stock price and almost all aspects of accounting performance. Their analysis suggests that one of the primary factors that contributed to Southwest's superior stock performance was its superior ability to cover both short-term and long-term liabilities. Taking Southwest as a typical low cost carrier, the paper attributes Southwest's overall success (and that of other low-cost carriers) to the fact that it has a lower and more variable cost structure and a lower breakeven load factor, which allow it to react to a changing environment more quickly than conventional airlines.

In the wake of September 11, governments, carriers, passengers, shippers and other stakeholders all have a heightened sense of awareness of the importance of transportation safety and security to human health and well-being, as well as a nation's ability to trade effectively. Walker, Thiengtham, and Lin examine the impact of aviation disasters on the stock price performance of airlines and airplane manufacturers. Using the event study method, the paper finds that anticipated legal liability claims appear to be a significant factor that drives the magnitude of an airline stock's initial price decline, and crashes that result in many fatalities and crashes that occur in the U.S., where airlines face unlimited liability, cause particularly large price declines. A similar, although weaker, result is found for aircraft manufacturers as well.

Bax investigates the conditions that influence the effectiveness of regional road safety policy making. The paper focuses on how the decision-making process should be organized in order to reach an effective and efficient road safety policy in the presence of multiple parties with different goals and interests. Based on six cases (regions) in the Netherlands, the paper examines 27 conditions/prerequisites under three categories: promotion of road safety interests, organization of decision making process, and use of information. The paper concludes that early negotiation is needed to reach an effective and efficient road safety policy when there are multiple parties involved, and delegating the decisionmaking process to an external third party or independent safety board will be equally effective.

The issues of pricing and competitive access are among the most contentious in rail policy. …