DEM Research Seminar with Kristof Horvat, LCL, University of Luxembourg

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Estimating Demand and Cost Pass-Through Elasticities in Parcel Logistics: Evidence from a Multi-Carrier Digital Broker

Abstract

Digital parcel brokers act as intermediaries between carriers and customers: they purchase transport capacity from multiple carriers and offer customers an all-in shipping price. This paper studies two core objects in pricing in a platform setting: (i) booking-price elasticities for standardized parcel services and (ii) procurement-cost pass-through into customer-facing prices.

We integrate multiple internal databases to link each shipment to the price, the corresponding carrier cost, and detailed booking attributes. The final sample contains more than 500,000 shipments over a multi-year period across multiple European markets.

A central identification challenge is endogenous pricing: quoted prices include markups that may respond to information correlated with unobserved demand conditions, causing OLS estimates to confound demand effects with brokers’ pricing decisions.

The analysis shows that both booking responsiveness and cost pass-through vary across origin markets and shipment segments, implying that uniform platform-wide pricing and pass-through rules are not granular enough. The findings provide evidence on demand and cost incidence in digital parcel brokerage and inform market–segment calibration of pricing and margin policies.

Language

English

This is a free seminar. Registration is mandatory.