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The nonlinear dynamic process of macroeconomic development by modelling dry bulk shipping market

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  • Ching-Chih Chang
  • Tin-Chia Lai

Abstract

The purpose of this research is to study the trough of the global economics crisis in 2007 by studying business cycle of dry bulk shipping market using an integrative model over the period from January 1999 to October 2008 with developing an integrative model. This market is comprised of three different vessel sizes (Capesize, Panamax and Handymax), which were affected to varying degrees by the global economic crisis. Empirical results indicate that there is one complete cycle during the research period, which was methodologically determined by X11 decomposition and the Phase Average Trend (PAT). The values of Mean Absolute Percentage Error (MAPE) for the predictive model are 4.0383% (Capesize), 0.8393% (Panamax) and 15.5012% (Handymax). The values of MAPE for the forecasting models are 19.4276%, 10.146% and 8.0399%, respectively. Results indicate that the troughs are September 2009 (Capesize and Panamax) and July 2009 (Handymax). This article concluded that the shipping and macroeconomic recession will persist until the end of 2009.

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  • Ching-Chih Chang & Tin-Chia Lai, 2011. "The nonlinear dynamic process of macroeconomic development by modelling dry bulk shipping market," Applied Economics Letters, Taylor & Francis Journals, vol. 18(17), pages 1655-1663.
    • Handle: RePEc:taf:apeclt:v:18:y:2011:i:17:p:1655-1663
    DOI: 10.1080/13504851.2011.558470
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    References listed on IDEAS

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    Cited by:

    1. Heij, C. & Knapp, S., 2012. "Dynamics in the dry bulk market," Econometric Institute Research Papers EI 2012-18, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.

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    Keywords

    dynamic process; integrative model; dry bulk market; X11; MAPE;
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