Empirical Valuation of Relationship between Freight Index and Economic Performance

Abstract

The index method is significant among the individual methods of scientific research. This work intends to develop ways to analyze the usage of transport indices as indicators of the character of market activity in logistical infrastructure at different levels. Transport indices only developed in the past decade; nevertheless, they have already developed a large degree of diversity. This makes systematization, classification, and identification of their distinguishing features all necessary. By their nature, freight indices are largely similar to stock market indices, in that they both show the average changes in some observed phenomenon, and that they both aim to describe the general changes in a process involving many factors. The authors propose a transport index classification with freight indices set aside in a separate group, depending on their intended applications and possible uses. As a result, based on the empirical analysis of the transport index and the stock market index, the level of interconnection between logistical infrastructure and market activity in the Russian economy has been defined, by applying the GARCH model. On the other hand, applying this methodology to the USA’s statistical transport index and stock market index gave no results. This once again confirms the necessity of setting freight indices aside in a separate group, as well as the futility of performing analytical procedures with statistically heterogeneous indexes.