| This thesis has two objectives: First, it assesses whether movements in freight rates can be predicted in a deregulated environment. This problem is addressed by analysing the US experience under deregulation. Several studies are analysed, that, generally, fail to reach a consensus on the effects of deregulation on the changes in freight rates. Given the lack of consensus from these studies, it leads to the belief that any prediction of freight rates in Canada is likely to be dependent on the market structure, and even then, rates may still remain uncertain.; Second, a survey was developed and mailed out to farmers in one region of Alberta. Using the results from the survey, several functional forms are estimated, for each crop, wheat, barley, and canola, in an attempt to get a range of the demand response of farmers as rates increase. Shipper responses range from 0.011 to 0.75, in absolute value, as rates increase. A LOGIT analysis shows a probability of decreasing acres planted of wheat to be 49.6% and that for canola to be 16.1%. Furthermore, railways were shown to have a revenue gain in the range of 12 to 66 percent, due largely to the lack of response of shippers, in this sample, to rate increases. |
