Abstract
Logistics is important in the service sector, even more so in international trade, a vital part of the economy. The delivery of raw materials and intermediate goods to manufacturers, and final goods to consumers, requires effective transport and management of the process. From this point of view, it is important to examine the economic dimension of logistics and transportation activities. This chapter clarifies logistics activities and mentions their place in economic disciplines. The economic analysis of the logistics sector is discussed in two dimensions as micro and macro scales. Effective factors in the development of an international logistics sector are explained.
TopBackground
Logistics, which firstly expressed the activities in the military field and later gained importance with the adaptation of the military applications to the field of management and production, has now become an interdisciplinary science which has a link with many branches of science such as primarily economics, management, marketing, political sciences, sociology, mathematics and engineering sciences (Stock, 1997). The relation of logistics discipline with economics is expressed by Stock (1997) within the scope of different theories.
Key Terms in this Chapter
Economy of scale: A phenomenon whereby larger volumes of production reduce unit cost by distributing fixed costs over a larger quantity.
Fulfillment: The act of fulfilling a customer order. Fulfillment includes order management, picking, packaging, and shipping.
Outbound Logistics: The process related to the movement and storage of products from the end of the production line to the end user.
Inbound Logistics: The management of materials from suppliers and vendors into production processes or storage facilities.
Logistics Costs: The factors associated with the acquisition, storage, movement, and disposition of goods.
Export: To send goods and services to another country.
Globalization: The process of making something worldwide in scope or application.
Gross National Product (GNP): A measure of a nation's output; the total value of all final goods and services a nation produces during a time period.
Import: Movement of products from one country into another. The import of automobiles from Germany into the US is an example.