American Trucking, NAFTA, and the Cost of Distance

Abstract

As trucking replaced railroads as the basic form of freight transportation, the cost structure of the industry, which is essentially linear in distance, became the standard measure of economic distance. This led to a structure of economic geography that was much flatter and less malleable by public policy. The rise of trucking made the nation more compact and more featureless than it had been. In essence, trucking shrank and leveled the economic landscape—which was not to the advantage of those places that had economically benefited from the geography created by the railroad cost structure. The trucking provisions of the North American Free Trade Agreement have the promise of similarly shrinking the distance between Canada, Mexico, and the United States. Their failure to be implemented can be traced to the equivocal attitude that different regions have to further leveling of the economic landscape of North America.