Standards of Reasonableness in Local Freight Discriminations

Standards Of Reasonableness In Local Freight Discriminations by John Maurice Clark. This monograph surveys how to define and apply 'reasonable' freight charges within the U.S. railroad system. Clark analyzes two rival views of rate-making: the private, profit-driven American approach and the public, scale-based European approach, especially the German-Austrian model. He introduces the concept of joint costs and the division of costs into prime, supplementary, and total costs, arguing that rates must cover prime costs and contribute to fixed charges, while reflecting the value of service and traffic conditions. The work distinguishes local discriminations from through rates and examines the tension between private interests and public welfare, including cost accounting, infant industries, and legal standards. It also proposes the idea of 'competition of markets' as a regulator beyond junction-point competition, and discusses distance tariffs such as the Staffel tarife and the practical use of distance scales in U.S. practice, with policy implications for tariffs, canals, and interstate regulation. Throughout, the author emphasizes the practical difficulties of articulating a universal rule of reasonableness, arguing for a mixed framework blending economic analysis with regulatory guidance.