Do Transportation and Communications Tend to Be Substitutes , Complements , or Neither ? U . S . Consumer Expenditures Perspective , 1984 – 2002

these potential relationships. The results have been mixed, with some finding net substitution and some finding complementarity [refer to Mokhtarian and Salomon (4) for a review]. Most of those studies, however, have taken a disaggregate approach and have been conducted on small samples, often focusing on just a single application such as telecommuting, teleconferencing, or Internet shopping. Although a disaggregate approach is invaluable for providing behavioral insight, it is often limited in the scope of activities it can capture (the questionnaires on which such studies are often based can only be so long) and restricted to relatively small and homogeneous samples. Aggregate approaches, by contrast, can often take a more comprehensive approach to the subject at hand and apply to a much larger population. This study takes such an approach, in which relationships between consumer expenditures on transportation and communications are investigated, using aggregate U.S. data for 1984 through 2002. The results will provide insight into the overall, net impacts of each on the other and will continue to refine understanding of this complex and important subject. This paper is organized as follows. The next section reviews most of the other aggregate studies on this subject. The third and fourth sections describe the consumer demand modeling approach taken in this study and the available expenditure and price data, respectively. The fifth section discusses the empirical results, and the final section offers some concluding observations, including a comparison of these new results with the most closely related aggregate studies discussed in the second section.