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Ocean liner shipping: Organizational and contractual response by agribusiness shippers to regulatory change

Author

Listed:
  • Hayden G. Stewart

    (Economic Research Service, U.S. Department of Agriculture, Room N-2134, 1800 M Street NW, Washington, DC 20036. E-mail: hstewart@ers.usda.gov)

  • Fred S. Inaba

    (Department of Economics, Washington State University, Pullman, Washington 99164-4750. E-mail: inaba@wsu.edu)

Abstract

The Ocean Shipping Reform Act of 1998 (OSRA) promotes changes in international ocean liner shipping. An important policy issue attendant to the passage of OSRA is the Act's likely impact on the international competitiveness of the sectors that depend upon ocean shipping. Thus, to establish how freight rates and other logistical costs of using ocean liner services are now determined, this study examines emerging methods of organization and contracting among exporters of food and forest products. We find that, although many shippers negotiate private contracts with carriers, many others utilize a third-party agent to negotiate a rate with a carrier on their behalf. This article also identifies differences between two key types of third-party agents. Finally, given that a shipper in this trade does not contract directly with a carrier, this article explains the shipper's conditional choice about which type of agent to use. [EconLit citations: L140, L980, Q130]. © 2003 Wiley Periodicals, Inc. Agribusiness 19: 459-472, 2003.

Suggested Citation

  • Hayden G. Stewart & Fred S. Inaba, 2003. "Ocean liner shipping: Organizational and contractual response by agribusiness shippers to regulatory change," Agribusiness, John Wiley & Sons, Ltd., vol. 19(4), pages 459-472.
    • Handle: RePEc:wly:agribz:v:19:y:2003:i:4:p:459-472
    DOI: 10.1002/agr.10072
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    References listed on IDEAS

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    1. Richard Neel & Carl Gooding, 1997. "Service contracts, rate discounting, and the future of shipping conferences," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 3(4), pages 388-394, November.
    2. Clyde, Paul S & Reitzes, James D, 1998. "Market Power and Collusion in the Ocean Shipping Industry: Is a Bigger Cartel a Better Cartel?," Economic Inquiry, Western Economic Association International, vol. 36(2), pages 292-304, April.
    3. Sorenson, John R. & Tschirhart, John T. & Whinston, Andrew B., 1978. "Private good clubs and the core," Journal of Public Economics, Elsevier, vol. 10(1), pages 77-95, August.
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