The Trade Reducing Effects of Restrictions on Liner Shipping

The costs of shipping containerized cargo on liner vessels play a pivotal role in determining a country's integration into international trade. We examine how policy governing the liner shipping sector affects maritime transport costs and seaborne trade flows. Using a novel data set of services...

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Bibliographic Details
Main Authors:	Bertho, Fabien, Borchert, Ingo, Mattoo, Aaditya
Format:	Journal Article
Language:	en_US
Published:	Elsevier 2016
Subjects:	maritime transport trade costs services trade policy investment restrictions connectivity
Online Access:	http://hdl.handle.net/10986/24258

id	okr-10986-24258
recordtype	oai_dc
spelling	okr-10986-242582021-05-26T09:05:19Z The Trade Reducing Effects of Restrictions on Liner Shipping Bertho, Fabien Borchert, Ingo Mattoo, Aaditya maritime transport trade costs services trade policy investment restrictions connectivity The costs of shipping containerized cargo on liner vessels play a pivotal role in determining a country's integration into international trade. We examine how policy governing the liner shipping sector affects maritime transport costs and seaborne trade flows. Using a novel data set of services trade policy information, we find that restrictions, particularly on foreign investment, significantly increase maritime transport costs. The cost-inflating effect ranges from 26% to 68%, and the resultant reduction in trade flows from 48% to 77%, depending on the level of restrictiveness. We estimate the elasticity of seaborne trade flows with respect to distance to be nearly unity, and are able to disentangle the direct effect of distance from the one that is operating indirectly through higher maritime transport costs. Since the bulk of global merchandise goods trade is seaborne, the magnitude of frictions identified in this paper and their spatial distribution have ramifications for connectivity and growth. 2016-05-09T20:46:41Z 2016-05-09T20:46:41Z 2016-03-06 Journal Article Journal of Comparative Economics 0147-5967 http://hdl.handle.net/10986/24258 en_US CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Elsevier Publications & Research :: Journal Article Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	en_US
topic	maritime transport trade costs services trade policy investment restrictions connectivity
spellingShingle	maritime transport trade costs services trade policy investment restrictions connectivity Bertho, Fabien Borchert, Ingo Mattoo, Aaditya The Trade Reducing Effects of Restrictions on Liner Shipping
description	The costs of shipping containerized cargo on liner vessels play a pivotal role in determining a country's integration into international trade. We examine how policy governing the liner shipping sector affects maritime transport costs and seaborne trade flows. Using a novel data set of services trade policy information, we find that restrictions, particularly on foreign investment, significantly increase maritime transport costs. The cost-inflating effect ranges from 26% to 68%, and the resultant reduction in trade flows from 48% to 77%, depending on the level of restrictiveness. We estimate the elasticity of seaborne trade flows with respect to distance to be nearly unity, and are able to disentangle the direct effect of distance from the one that is operating indirectly through higher maritime transport costs. Since the bulk of global merchandise goods trade is seaborne, the magnitude of frictions identified in this paper and their spatial distribution have ramifications for connectivity and growth.
format	Journal Article
author	Bertho, Fabien Borchert, Ingo Mattoo, Aaditya
author_facet	Bertho, Fabien Borchert, Ingo Mattoo, Aaditya
author_sort	Bertho, Fabien
title	The Trade Reducing Effects of Restrictions on Liner Shipping
title_short	The Trade Reducing Effects of Restrictions on Liner Shipping
title_full	The Trade Reducing Effects of Restrictions on Liner Shipping
title_fullStr	The Trade Reducing Effects of Restrictions on Liner Shipping
title_full_unstemmed	The Trade Reducing Effects of Restrictions on Liner Shipping
title_sort	trade reducing effects of restrictions on liner shipping
publisher	Elsevier
publishDate	2016
url	http://hdl.handle.net/10986/24258
_version_	1764456257042776064

The Trade Reducing Effects of Restrictions on Liner Shipping

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