Economics

Greening transportation fleets: Insights from a two-stage game theoretic model

Document Type

Article

Abstract

The greening of organizational transportation fleets, especially trucks and automobiles, has gained increasing attention by companies in a variety of industrial sectors. The reasons for this concern and attention are due to regulatory and competitive pressures, but also increasing costs of fossil-fuels. Surprisingly the amount of research and modeling for fleet management overall has been rather limited, with the focus on managing green vehicle investments virtually non-existent. In this study we develop a two-stage game theoretic model that helps evaluate, from both policy and organizational perspectives, the implications of greening of transportation fleets. Various parameters are evaluated including factors such as innovations in green vehicle technology, levels of service differences, cost of fuel, adjusting tax policy, regulatory compliance requirements, and adaptation costs. This evaluation provides practical insights into actions that could be considered by regulators and organizations to encourage environmental investments. © 2011 Elsevier Ltd.

Publication Title

Transportation Research Part E: Logistics and Transportation Review

Publication Date

2011

Volume

47

Issue

6

First Page

793

Last Page

807

ISSN

1366-5545

DOI

10.1016/j.tre.2011.05.015

Keywords

environmental, game theory, investment justification, regulatory policy, transportation fleet management

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