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Determinants of maritime transport costs -- a panel data analysis for Latin American trade

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  • Gordon Wilmsmeier
  • Inmaculada Martínez-Zarzoso

Abstract

This paper analyses the determinants of maritime transport costs for intra-Latin American trade over a period of 6 years (1999--2004). The data refer to yearly disaggregated (five-digit level Standard International Classification) containerised maritime trade flows on 277 trade routes. With this data-set, a transport costs equation is estimated using linear regression analysis in a panel data framework. The first contribution to the literature is to exploit the greater variability present in the data and to control for unobservable heterogeneous effects. The second is to investigate the role of distance as a determinant of international maritime transport costs in comparison to the location within the liner services network and the potential impact of being peripheral in the liner shipping network. Finally, the work analyses influence of open registries on the variability of maritime transport costs. To the authors’ knowledge, this has not been done previously. Three groups of explanatory variables are considered. Firstly, time variant variables: use of open registries and trade imbalance. Secondly, variables related to liner shipping network structures: number of liner services; shipping opportunities; deployed ships and deployed TEUs. Finally, product-related variables such as volume of shipment, value of product and special characteristics of the cargo (i.e. refrigerated cargo). The results allow the quantification of the effects of explanatory variables on international maritime transport costs and to compare the obtained elasticities with previous cross-section analyses. In particular, estimating the impact of the use of open registries on maritime transport cost is a new contribution in this field that could provide policy-makers with valuable information to be used in the implementation of economic policies.

Suggested Citation

  • Gordon Wilmsmeier & Inmaculada Martínez-Zarzoso, 2009. "Determinants of maritime transport costs -- a panel data analysis for Latin American trade," Transportation Planning and Technology, Taylor & Francis Journals, vol. 33(1), pages 105-121, October.
    • Handle: RePEc:taf:transp:v:33:y:2009:i:1:p:105-121
    DOI: 10.1080/03081060903429447
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    2. Enrico Pastori & Miriam Tagliavia & Enrico Tosti & Simonetta Zappa, 2014. "The survey on international freight rates in Italy: methods and results," Questioni di Economia e Finanza (Occasional Papers) 223, Bank of Italy, Economic Research and International Relations Area.
    3. Sami Bensassi & Inmaculada Martínez-Zarzoso, 2012. "How Costly is Modern Maritime Piracy to the International Community?," Review of International Economics, Wiley Blackwell, vol. 20(5), pages 869-883, November.
    4. Inmaculada Mart�nez-Zarzoso & Sami Bensassi, 2013. "The Price Of Modern Maritime Piracy," Defence and Peace Economics, Taylor & Francis Journals, vol. 24(5), pages 397-418, October.
    5. Gordon Wilmsmeier & Inmaculada Martínez-Zarzoso & Norbert Fiess, 2010. "Regional Hub Port Development - The Case of Montevideo, Uruguay," Ibero America Institute for Econ. Research (IAI) Discussion Papers 203, Ibero-America Institute for Economic Research.
    6. Ozlem Yaylaci, 2012. "Evolution of Trade Costs," EcoMod2012 4267, EcoMod.
    7. David Guerrero, 2018. "Impacts of transport connections on port hinterlands," Post-Print hal-01822851, HAL.
    8. Sami Bensassi & Laura Márquez-Ramos & Inmaculada Martínez-Zarzoso, 2012. "Economic Integration and the Two Margins of Trade: The Impact of the Barcelona Process on North African Countries' Exports," Journal of African Economies, Centre for the Study of African Economies, vol. 21(2), pages 228-265, March.
    9. Munasib, Abdul B.A. & Roy, Devesh, 2011. "Nontariff Barriers as Bridge to Cross," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 125025, International Association of Agricultural Economists.
    10. Wilmsmeier, Gordon & Sanchez, Ricardo J., 2009. "The relevance of international transport costs on food prices: Endogenous and exogenous effects," Research in Transportation Economics, Elsevier, vol. 25(1), pages 56-66.
    11. Ricardo J. Sanchez & Gordon Wilmsmeier, 2011. "Liner Shipping Networks and Market Concentration," Chapters, in: Kevin Cullinane (ed.), International Handbook of Maritime Economics, chapter 9, Edward Elgar Publishing.
    12. Jordan Schwartz & José Luis Guasch & Gordon Wilmsmeier, 2009. "Logistics, Transport and Food Prices in LAC: Policy Guidance for Improving Efficiency and Reducing Costs," IDB Publications (Working Papers) 9324, Inter-American Development Bank.
    13. De Oliveira, Gabriel Figueiredo, 2014. "Determinants of European freight rates: The role of market power and trade imbalance," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 62(C), pages 23-33.
    14. Lim, Kian Guan, 2022. "Endogeneity of commodity price in freight cost models," Journal of Commodity Markets, Elsevier, vol. 26(C).
    15. Patricia Sourdin & Richard Pomfret, 2012. "Trade Facilitation," Books, Edward Elgar Publishing, number 14596.
    16. Schwartz, Jordan & Guasch, José Luis & Wilmsmeier, Gordon, 2009. "Logistics, Transport and Food Prices in LAC: Policy Guidance for Improving Efficiency and Reducing Costs," IDB Publications (Working Papers) 2541, Inter-American Development Bank.

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    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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