Transportation is Part of Production

Transportation, which plays a central role in trade because of its ecological impact, is treated by ENL as an element of production, not distribution.

Distribution is a social act — the assignment of final outputs to the individuals who will consume them through markets, charity, etc.

Transportation is instead a physical act that moves intermediate outputs to production facilities and final outputs to the sphere of consumption. Distribution cannot begin until these acts are complete.

ENL thus considers transportation to be the final stage of the production process. This treatment has several implications for value and cost.

Most importantly, transportation increases the input cost of production. There is currently no way to escape the high natural costs associated with the trucks, trains, ships, and planes that move outputs between regions and then to their final destinations.

The pollution, accidents, and stress-inducing noise associated with all modes of transportation are well-known and need no elaboration here. The input cost of exports thus includes the significant natural costs, as well as any labor costs, associated with transportation.

Another effect of transportation relates to output losses. If a cargo ship that is loaded with furniture sinks, or if a truck's refrigeration fails and its load of produce is spoiled, the production of these final outputs is effectively negated and the output's potential gains are reduced. Such losses decrease production efficiency.

If intermediate outputs are lost in transportation, the input cost incurred in their production is squandered. This will increase the per-unit input cost of the final outputs with which they are associated.

A third possible effect of transportation is to decrease potential value rather than negating it outright. Perishable foods often degrade while being stored for transportation, or during transportation itself.

In addition, foods are frequently grown, genetically modified, or chemically treated in ways that permit them to survive long trips without causing either real or visible damage. This is certainly true for tomatoes, many varieties of which have been bred for firmness and transportability rather than for flavor and health benefits.

In many cases the nutritional value, and hence the potential value, of such outputs declines significantly through the transportation process. To simplify the discussion, this effect is ignored in this section.

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