The demand for transport and communication in the United Kingdom and Australia

This paper investigates the substitution/complementarity relationship among the demands for private transport, public transport and communication in the United Kingdom and Australia for the period 1960-1986. The authors use the Rotterdam Demand System for the analysis. The results identify major similarities and some important differences in consumption of these goods in the two countries. Further, they show that in both countries (a) private transport is a luxury and public transport is a necessity; (b) the demand for all three goods are price inelastic and (c) public transport, private transport and communications are pair-wise substitutes.