University of Arkansas, Fayetteville ScholarWorks@UARK Theses and Dissertations 8-2016 Modeling Economic Impacts of the Inland Waterway Transportation System Furkan Oztanriseven University of Arkansas, Fayetteville Follow this and additional works at: http://scholarworks.uark.edu/etd Part of the Industrial Organization Commons, and the Transportation Engineering Commons Recommended Citation Oztanriseven, Furkan, "Modeling Economic Impacts of the Inland Waterway Transportation System" (2016). Theses and Dissertations. 1691. http://scholarworks.uark.edu/etd/1691 This Dissertation is brought to you for free and open access by ScholarWorks@UARK. It has been accepted for inclusion in Theses and Dissertations by an authorized administrator of ScholarWorks@UARK. For more information, please contact [email protected], [email protected]. Modeling Economic Impacts of the Inland Waterway Transportation System A dissertation submitted in partial fulfillment of the requirements for the degree of Doctor of Philosophy in Engineering by Furkan Oztanriseven Istanbul Technical University Bachelor of Science in Industrial Engineering, 2009 Colorado State University- Pueblo Master of Science in Industrial and Systems Engineering, 2011 Master of Business Administration, 2011 August 2016 University of Arkansas This dissertation is approved for recommendation to the Graduate Council. ________________________ Dr. Heather Nachtmann Dissertation Director ________________________ ________________________ Dr. Kim Needy Dr. Edward Pohl Committee Member Committee Member ________________________ Dr. Suzanna Long Committee Member Abstract The inland waterway transportation system of the United States (U.S.) handles 11.7 billion tons of freight annually and connects the heartland of the U.S. with the rest of the world by providing a fuel-efficient and environmentally friendly mode of transportation. This dissertation aims to create decision support tools for maritime stakeholders to measure the economic impacts of the inland waterway transportation systems under real world scenarios including disruptions, demand changes, port expansion decisions, and channel deepening investments. Monte Carlo simulation, system dynamics, discrete-event simulation, agent-based modeling, and multiregional input-output modeling techniques are utilized to analyze the complex relationships between inland waterway transportation system components and regional economic impact factors. The first research contribution illustrates that the expected duration of a disruption determines whether decision makers are better off waiting for the waterway system to reopen or switching to an alternative mode of transportation. Moreover, total disruption cost can be reduced by increasing estimation accuracy of disruption duration. The second research contribution shows that without future investment in inland waterway infrastructure, a sustainable system and associate economic impacts cannot be generated in the long-term. The third research contribution illustrates that investing in bottleneck system components results in higher economic impact than investing in non-bottleneck components. The developed models can be adapted to any inland waterway transportation system in the U.S. by utilizing data obtained by publically available sources to measure the economic impacts under various scenarios to inform capital investment decisions and support an economically sustainable inland waterway transportation system. Acknowledgments First and foremost, I would like to acknowledge my Ph.D. advisor and mentor, Dr. Heather Nachtmann, for being a great teacher, researcher, and supporter from the very first day of my Ph.D. education. I would like to thank her for giving me guidance during the most challenging times in my dissertation research and preparing me for success in my future academic career. I would also like to thank my dissertation committee members, Dr. Kim Needy, Dr. Edward Pohl, and Dr. Suzanna Long, for their valuable time to support me during my job search and serving in my Ph.D. committee. I would like to thank the faculty and staff of the Department of Industrial Engineering at the University of Arkansas. I am very thankful to all my friends who supported me through my Ph.D. journey. Especially, I express my genuine gratitude to Hulusi Turgut, Asya Ozkizilcik, Lizzette Perez Lespier, Ridvan Gedik, Emre Kirac, Ege Ozdemir, Ali Capar, Payam Parsa, Paiman Farrokh, Serdar Kilinc, and Jingjing Tong. Finally, I would like to thank my beloved father and mother, Bulent Oztanriseven and Sevgi Pinar, for their unconditional support throughout my life. None of my success would have been possible without their sacrifices and constant support. Table of Contents 1. INTRODUCTION ...................................................................................................................... 1 1.1 Research Motivation ............................................................................................................. 1 1.2 Research Objectives .............................................................................................................. 5 1.3 Research Methodology .......................................................................................................... 6 1.4 Research Contributions ......................................................................................................... 7 1.5 Organization of Dissertation ................................................................................................. 8 References ................................................................................................................................. 10 2. LITERATURE REVIEW ......................................................................................................... 12 2.1 A Review of Economic Impact Analysis in Maritime Transportation Disruption ............. 12 2.1.1 Introduction .................................................................................................................. 12 2.1.2 Economic Analysis Methodology Used ....................................................................... 12 2.1.3 Affected Region Studied .............................................................................................. 15 2.1.4 Source of Economic Impact ......................................................................................... 16 2.1.5 Economic Indicators Used ............................................................................................ 17 2.1.6 Disruption Case Scenario ............................................................................................. 19 2.1.7 Type of Disruption Studied .......................................................................................... 20 2.1.8 Alternative Modes of Transportation and Rerouting .................................................... 21 2.1.9 Conclusions and Future Work ...................................................................................... 22 Appendix 1 ................................................................................................................................ 24 Appendix 2 ................................................................................................................................ 25 References ................................................................................................................................. 26 2.2 A Review of System Dynamics in Maritime Transportation .............................................. 29 2.2.1 Introduction .................................................................................................................. 29 2.2.2 Literature Review ......................................................................................................... 30 2.2.3 Classification of the MTSSD Literature ....................................................................... 34 2.2.4 MTSSD Methodology Classification ........................................................................... 41 2.2.5 Conclusion and Future Work ........................................................................................ 44 Appendix 1 ................................................................................................................................ 46 Appendix 2 ................................................................................................................................ 47 References ................................................................................................................................. 48 3. ECONOMIC IMPACT ANALYSIS OF INLAND WATERWAY DISRUPTION RESPONSE ....................................................................................................................................................... 51 3.1 Introduction ......................................................................................................................... 51 3.2 Literature Review ................................................................................................................ 53 3.3 Methodology ....................................................................................................................... 56 3.3.1 Disruption Scenarios..................................................................................................... 56 3.3.2 Model Assumptions ...................................................................................................... 57 3.3.3 Model Formulation