Drone logistics’ resilient development: impacts of consumer choice, competition, and regulation

Baozhuang Niu, Jianhua Zhang and Fengfeng Xie

Transportation Research Part A: Policy and Practice, 2024, vol. 185, issue C

Abstract: Recently, drone logistics provided by many logistics service providers (LSPs) has significantly influenced consumers’ choice for last-mile delivery. Undoubtedly, drone logistics leads to more efficient deliveries and the avoidance of traffic congestion, but may incur higher operational costs and be easily impacted by government policies on drones. To figure out when should an LSP launch drone logistics and examine the impact of drone logistics on traditional logistics under airspace regulations, we develop a consumer utility model to formulate consumers’ choices, the LSPs’ profitability, and the competition dynamics between traditional and drone logistics services. We find that the introduction of drone logistics leads to intensified competition and potentially lower prices for traditional logistics. Our findings also suggest that stricter airspace regulations on drones may not deter the booming demand for drone logistics but could lead to increased service prices of traditional logistics, making the LSP’s profit increase. This study uncovers the impact and value of drone logistics, thereby helping regulators better tailor policies to manage market competition and regulate drone logistics.

Keywords: Logistics operations; Drone logistics; Airspace regulation; Consumer choice (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0965856424001745
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:transa:v:185:y:2024:i:c:s0965856424001745

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/supportfaq.cws_home/regional
https://shop.elsevie ... _01_ooc_1&version=01

DOI: 10.1016/j.tra.2024.104126

Access Statistics for this article

Transportation Research Part A: Policy and Practice is currently edited by John (J.M.) Rose

More articles in Transportation Research Part A: Policy and Practice from Elsevier
Bibliographic data for series maintained by Catherine Liu ().