Physical node addresses are used at the network access layer to identify physical devices in a network. For example, each Ethernet controller comes from the manufacturer with a physical address, called a MAC address.
IP implements a system of logical host addresses called IP addresses. The IP addresses are used by the internetwork and higher layers to identify devices and to perform internetwork routing. The Address Resolution Protocol (ARP) enables IP to identify the physical (MAC) address that matches a given IP address. You can use ARP only on Ethernet and bridged IP 1483 interfaces.
IP is used by all protocols in the layers above and below it to deliver data. This means that all TCP/IP data flows through IP when it is sent and received, regardless of its final destination.