Fall 2013 (Vol. 52, No. 3)

The Economic Impact of Increased Congestion for Freight-Dependent Businesses in Washington State

Abstract

Congestion in the transportation system necessitates select businesses to operate on a less efficient production function. A survey of freight-dependent businesses in Washington State was used to calculate the costs of congestion and economic impact of increased congestion. As these businesses spend more to provide goods, responses suggest consumers would pay 60% to 80% of the increased cost. Primary areas of increased cost were identified as additional trucking and inventory costs. Results identify an additional $8.7 billion in consumer costs for a 20% congestion increase. The economic impact is a loss of $3.3 billion in total output and over 27,000 jobs.

by Justin Taylor, Ken Casavant, Jeremy Sage, Danna L. Moore, and Barb Ivanov

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