Working Paper: NBER ID: w8525
Authors: Thomas N. Hubbard
Abstract: Productivity reflects not only how efficiently inputs are transformed into outputs, but also how well information is brought to bear on resource allocation decisions. This paper examines this empirically by looking at how on-board computer (OBC) adoption has affected capacity utilization in the trucking industry. Estimates using 1997 data indicate that capacity utilization has increased by an average of 13% among trucks for which advanced OBCs have been adopted. The average benefits to adopters are higher in 1997 than 1992, suggesting lags to the returns to adoption, and are highly skewed across hauls. The 1997 estimates imply that OBC-enabled improvements in communications and resource allocation decisions have led to a 3% increase in capacity utilization in the industry, which translates to billions of dollars of annual benefits. The commercialization of other wireless networking applications has the potential to generate analogous benefits in other contexts.
Keywords: No keywords provided
JEL Codes: E23; D24; L92; O33
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| OBC adoption (J13) | capacity utilization (E23) |
| OBC-enabled improvements in decision-making (D91) | capacity utilization (E23) |
| OBC adoption (J13) | OBC-enabled improvements in decision-making (D91) |