ECONOMY AND LOGISTICS

U.S. Economy and its Impact on Transportation and Logistics Management

Abstract

This paper extensively explores the structure of U.S. economy and its impact on transportation and logistics management. In doing so, the paper first explores the economy dynamics of United States in their historic and present state. The paper traces the cyclical economic positions taken by the U.S. economy in the Great Depression of the 1930s, the recession and crisis of 2007. Further the paper presents the state of U.S. economy following the recession until now. The economic pictures have been presented keeping in view its relation with the transportation and logistics industry of the United States. Since this industry is the key driving force of economic activities, discussion relating to the industry's structural problems is also included.

Table of Contents

Introduction4

Depression in the United States5

The global impact of the crisis6

The United States in the twentieth century7

What factors helped this expansion?8

What was the basis of the great economic expansion of the 20s?8

The 1929 crisis9

Economic Recession 200711

Causations11

The Great Recession, Effective Demand & Policy Response13

Fiscal Policy13

Monetary Policy14

Post Recession Economy until Now15

American Macroeconomic and Trade Policies16

Post-Recession Recovery17

Impact of Policy18

United States Data in Tables19

Logistics and Transportation Management20

Globalization and Logistics20

Supply Chain22

Functions in the logistics area23

Logistics Types24

Purchasing Logistics25

Distribution Logistics25

Transport Logistics25

Logistics reserves26

Lean Logistics26

Conclusion27

U.S. Economy and its Impact on Transportation and Logistics Management

Introduction

The United States believes in a system of open trade, to which the principle of legality. Since the Second World War, Presidents of the United States argued that participation in world trade offers American producers access to a broad foreign markets and gives American consumers the possibility of greater choice when buying products (Reilly & Mollenkamp 2007). Recently, leaders of America noted that competition from foreign producers also allows maintaining low prices for many commodities, thus softening the impact of inflation. In formulating the economic and business policies, United States considers the role of logistics and transportation as a key driver for competitive edge.

Transportation has evolved considerably over the past twenty years (Baykasoglu, Kaplanoglu, Erol & Sahin 2011). Among the many factors behind this development, the development of logistics in industrial and commercial companies, coupled with the movement towards deregulation and deregulation of the transport sector, is probably very significant. The transport industry in its own right is indeed one of the many operations which constitute the supply chain organized by companies that send, receive and transfer products.

The choice of transport modes, the organization and pace of trade for them, therefore results in a holistic approach to physical movement. Transportation logistics impacts on factors like price, availability, speed, reliability, flexibility, operational constraints of the products. Therefore, logistical arrangements have particular impact on the number of industrial sites and logistics, their location, inventory levels or frequencies of restocking (Vahrenkamp 2010). On the other hand, practices and principles of transportation logistics suggest or require changes to better meet the "demand" businesses and their customers.

Depression in the United States

In the late twenties, U.S. economy felt the first signs of economic stagnation: slowed agricultural production and public and private construction ...