Modeling the Impacts of Climatic Extremes on Interregional Freight-Transportation System

Abstract

The wellbeing of a nation is conditioned on an optimal distribution of commodity-flow. The freight transportation system, however, is exposed, and highly vulnerable, to climatic hazards. This becomes more problematic in the long term when climate change is projected to continue or worsen. Studying the long-term climate vulnerability of interregional commodity shipment is a challenging task given complexities inherent in ( a) the dynamic formulation of factors such as location, production, the interaction of regional economies, and commodity distribution patterns, and ( b) the stochastic arrival and intensity of natural hazards. This article studies the impact of projected climatic extremes in the State of New York on long-term interregional commodity-flow. It investigates the nature of and extent to which vulnerabilities in transportation infrastructure may cause sudden and profound changes in the routing assignment and cost of commodity-flows. We approximate commodity-flow assignment through a dynamic, long-term estimation of an interregional commodity-flow model reflecting the choices of households, market places, and firm locations and strategies. In the research here reported, we also utilized explicit treatment of trade in intermediate goods, the so-called new economic geography providing the behavioral foundation for production and interindustry and interregional trade, and an endogenous determination of capital investment and employment. The results show how and to what extent the (partial-)connectedness of New York State’s freight-transportation network in time of disaster ( a) causes an unmet demand for commodities across the nation’s regional economies and ( b) increases the shipment cost and effective-delivered price of commodity-flows.