Analysis of economies of size and density for short line railroads

After the Staggers Rail Act, Class I railroads had more flexibility to sell and abandon sections of rail track. Much of this track was taken over by short lines, with many short lines being viable while others were not. Previous research studies have not adequately addressed the issue of viability because of the data used and the advancements in techniques since these studies were produced, such as the Translog Cost Function.;Short lines could achieve greater cost savings by increasing their density (revenue ton miles per mile) and their size (mile of road). Size is an important criterion when evaluating the purchase of a new section of track. Also by increasing their density, short lines are able to decrease their average cost. This study's cost analysis demonstrates a need for longer hauls and/or larger train configurations for short fines to remain viable.