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Geographic Imbalance, Search Frictions, and Regulation : Causes of Empty Miles in Freight Trucking
World Bank
2024.05.20
How prevalent are empty miles in freight trucking markets, and what are the economic frictions that contribute to empty miles? This study collected estimates of empty trips, empty miles, and backhaul probabilities from the economics and transportation literature, covering 40 years and 27 countries. A meta-analysis provides an average empty mile share of 29 percent, with significant variation across settings. High-income countries tend to have lower shares of empty miles than low- and middle-income countries. This study reviews empirical evidence behind three potential mechanisms behind empty trips, geographic imbalances in freight demand, search and matching frictions, and regulatory barriers, and develops a stylized model to capture these sources and evaluate potential policies.