Derived demand

05.07.2013 09:47

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Derived demand

1) Means demand derived from some function other than itself. Thus transport is not in demand for its own characteristics, but for the facility it provides to move people or goods.

For example a manufacturing firm’s demand for transport exists only because demand for its products exists and as demand for these increases so too does its demand for transport. In other words, the demand for transport derives from the demand for the manufacturer’s products.

Source: David Lowe. The Dictionary of Transport and Logistics. Kogan Page, 2002. – P.63 (288 p.)


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