The Effects of Distance and Cost of Transportation on Machinery and Transport Equipment Trade through Time for Asia-Europe-Africa

This paper is an endeavor to give an appraisal of the effects of distance and cost of transportation on machinery and transport equipment trade through time for Asia, Europe, Africa and integrated area of these three continents namely as AEA in the both intercontinental and intracontinental levels. For distribution freight modeling, a developed trans-continental multimodal network in AEA is defined. The distribution models facilitated identification of possible relations between trade and transportation during four decades covering 1965-2005. Preliminary statistical analyses and cross-sectional analyses for the gravity model introduced GDP and transportation variables as the most determinants of trade. The coefficients of gravity models reflected the elasticity of dependent trade variables with respect to descriptive variables. The linear regression models of trade elasticity through time showed increasing time trends. The percentage of improvement, based on developed linear programming models, in multimodal transportation network with the cost characteristic has decreased during time for Europe and Africa. In contrast, percentage of improvement for AEA and Asia has decreased over time indicating that the observed machinery and transport equipment distribution did not follow the optimal one. Finally, results for multimodal networks revealed that the percentage of improvement has had a greater value with respect to the distance parameter in comparison with the cost parameter through the studied time.