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Information Technology and Transportation: Substitutes or Complements?

Oliver, Atara Stephanie (2014): Information Technology and Transportation: Substitutes or Complements?

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Abstract

The increased prevalence of Information and Communications Technology (ICT) provides opportunities to substitute ICT for transportation. However, ICT can also be a complement for transportation, and prior research on the effect of ICT on travel for specific purposes has shown mixed results. Therefore, I examined the relationship between ICT and transportation on a larger scale, using a modified Quadratic Almost Ideal Demand System (QUAIDS) model to calculate expenditure and price elasticities for several categories of ICT and transportation goods. Among other results, I found that cellular service was a complement for private transportation, while home Internet service had no effect.

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