Disentangling Regulatory Policy: The Effects of State Regulations on Trucking Rates

Authors:
Timothy P. Daniel and Andrew N. Kleit
Working Paper:
205

This paper combines state-level data on trucking rates with information on state-level regulations to estimate the independent effect on rates from three different types of motor carrier regulations: rate regulation; entry regulation; and the provision of antitrust immunity for decisions made jointly by motor carrier rate bureaus. The empirical results indicate that state-level motor carrier regulations generally increase trucking rates, with entry regulation having the largest effect in the LTL (less-than-truckload) sector and rate regulation having the largest effect in the TL (truckload) sector. The study also examines interaction effects among the three types of regulations, and concludes that the combination of strict entry requirements and antitrust immunity leads to significant increases in trucking rates