Modal Freight Transportation: A Study of the Reactivation of the Magdalena River, Colombia

Abstract

This paper examines the demand for modal freight transportation on the Magdalena River, in order to study the effects that the current project to enhance its navigability. Using data from a survey of 30 import and export companies in Bogota, discrete choice models are used to estimate the probabilities of using the river and the elasticities to changes in freight rates, journey times, reliability and regularity. It is found that the rate, time, and reliability of the transport service offered throughout the River would affect the probability of choosing it. The model with the best goodness of fit predicts a likelihood of using the river between 10,5% and 24,5%, depending on the efficiency of these variables. The results suggest the need for further investments in the Magdalena River, not only to reduce freight rates, but also to reduce journey times and increase punctuality.