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Do transport costs have a differential effect on trade at the sectoral level?

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Listed:
  • Inmaculada Martinez-Zarzoso
  • Eva Maria Perez-Garcia
  • Celestino Suarez-Burguet

Abstract

This article aims to analyse the determinants of transport costs and to investigate their influence in international trade with a sample of disaggregate trade data. First, we estimate a transport-cost function using cross-section data on maritime and overland transport for four sectors: agro-industry, ceramic tiles, motor vehicle parts and accessories, and electrical and mechanical household appliances, obtained from interviews held with Spanish exporters and logistics operators in 2001. Second, we study the relationship between transport costs and trade and estimate the elasticity of trade with respect to transport costs for each sector. Important differences for high value- and low value-added sectors are observed. The trade-equation estimation shows that higher transport costs significantly deter trade, especially in high value-added sectors.

Suggested Citation

  • Inmaculada Martinez-Zarzoso & Eva Maria Perez-Garcia & Celestino Suarez-Burguet, 2008. "Do transport costs have a differential effect on trade at the sectoral level?," Applied Economics, Taylor & Francis Journals, vol. 40(24), pages 3145-3157.
    • Handle: RePEc:taf:applec:v:40:y:2008:i:24:p:3145-3157
    DOI: 10.1080/00036840600994179
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    References listed on IDEAS

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    1. Alan V. Deardorff, 2011. "Determinants of Bilateral Trade: Does Gravity Work in a Neoclassical World?," World Scientific Book Chapters, in: Robert M Stern (ed.), Comparative Advantage, Growth, And The Gains From Trade And Globalization A Festschrift in Honor of Alan V Deardorff, chapter 24, pages 267-293, World Scientific Publishing Co. Pte. Ltd..
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    Cited by:

    1. Borchert, Ingo & Mattoo, Aaditya, 2016. "The trade reducing effects of restrictions on liner shippingAuthor-Name: Bertho, Fabien," Journal of Comparative Economics, Elsevier, vol. 44(2), pages 231-242.
    2. Liquan Guo & Zhongzhen Yang, 2019. "Relationship Between Shipping Accessibility and Maritime Transport Demand: the Case of Mainland China," Networks and Spatial Economics, Springer, vol. 19(1), pages 149-175, March.
    3. Craig Macphee & Peter Cook & Wanasin Sattayanuwat, 2013. "Transportation and The International Trade of Eastern and Southern Africa," South African Journal of Economics, Economic Society of South Africa, vol. 81(2), pages 225-239, June.
    4. Luisa Marti & Rosa Puertas, 2019. "Factors determining the trade costs of major European exporters," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 21(3), pages 324-333, September.
    5. Pérez-Mesa, Juan Carlos & García-Barranco, M & Piedra-Muñoz, Laura & Galdeano-Gómez, Emilio, 2019. "Transport as a limiting factor for the growth of Spanish agri-food exports," MPRA Paper 119855, University Library of Munich, Germany.
    6. Theresa Osborne & Maria Claudia Pachon & Gonzalo Enrique Araya, 2013. "What Drives the High Price of Road Freight Transport in Central America?," World Bank Publications - Reports 17845, The World Bank Group.
    7. Röttgers, Dirk & Grote, Ulrike, 2014. "Africa and the Clean Development Mechanism: What Determines Project Investments?," World Development, Elsevier, vol. 62(C), pages 201-212.
    8. Matthias Busse & Ruth Hoekstra & Jens Königer, 2012. "The Impact of Aid for Trade Facilitation on the Costs of Trading," Kyklos, Wiley Blackwell, vol. 65(2), pages 143-163, May.
    9. 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.
    10. Inmaculada Mart󹑺-Zarzoso, 2013. "The log of gravity revisited," Applied Economics, Taylor & Francis Journals, vol. 45(3), pages 311-327, January.
    11. Wessel, Jan, 2019. "Evaluating the transport-mode-specific trade effects of different transport infrastructure types," Transport Policy, Elsevier, vol. 78(C), pages 42-57.
    12. Llano, C. & De la Mata, T. & Díaz-Lanchas, J. & Gallego, N., 2017. "Transport-mode competition in intra-national trade: An empirical investigation for the Spanish case," Transportation Research Part A: Policy and Practice, Elsevier, vol. 95(C), pages 334-355.
    13. Nguyen, Hong-Oanh & Tongzon, Jose, 2010. "Causal nexus between the transport and logistics sector and trade: The case of Australia," Transport Policy, Elsevier, vol. 17(3), pages 135-146, May.
    14. Luisa Martí & Rosa Puertas, 2017. "The importance of export logistics and trade costs in emerging economies," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 19(2), pages 315-333, June.
    15. Sierra-Fernández, Mª Del Pilar & Martínez-Campillo, Almudena, 2009. "Impacto del proceso de integración europea sobre las exportaciones de Castilla y León (1993-2007): un análisis econométrico a partir de la ecuación de gravedad/The Impact of the European Integration P," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 27, pages 783(34á)-78, Diciembre.

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