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Transportation uncertainty and international trade

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  • Liu, Xiaoyun
  • Xin, Xian

Abstract

This paper uses a numerical framework to demonstrate that uncertainty in the arrival time of foreign goods can substantially reduce the demand for foreign goods. It further reveals that the impacts of falling transport costs and shipment time on international trade growth could be discounted, if uncertainty arises in the arrival time of the imported goods. This in turn suggests that reduced uncertainty, which is possibly the results of transportation improvements, might have contributed to the growth experienced in world trade growth over the past several decades. Thus, neglecting the roles of improvements in international transportation arrangements and reduced uncertainty will lead to underestimating the contribution of transportation improvements to trade growth.

Suggested Citation

  • Liu, Xiaoyun & Xin, Xian, 2011. "Transportation uncertainty and international trade," Transport Policy, Elsevier, vol. 18(1), pages 156-162, January.
  • Handle: RePEc:eee:trapol:v:18:y:2011:i:1:p:156-162
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    References listed on IDEAS

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    Cited by:

    1. Evgenie P. Zharikov & Alla A. Kravchenko & Olesya O. Sergeeva & Victor V. Stetsyuk, 2016. "Econometric Estimation of Bilateral Transboundary Trade between Russia and China," International Journal of Economics and Financial Issues, Econjournals, vol. 6(3), pages 1068-1071.
    2. repec:spr:eurase:v:8:y:2018:i:1:d:10.1007_s40822-017-0081-1 is not listed on IDEAS
    3. repec:eee:retrec:v:66:y:2017:i:c:p:70-77 is not listed on IDEAS
    4. Ülengin, Füsun & Çekyay, Bora & Toktaş Palut, Peral & Ülengin, Burç & Kabak, Özgür & Özaydın, Özay & Önsel Ekici, Şule, 2015. "Effects of quotas on Turkish foreign trade: A gravity model," Transport Policy, Elsevier, vol. 38(C), pages 1-7.
    5. Ülengin, Füsun & Özaydın, Özay & Ülengin, Burç & Kopp, Andreas & Önsel, Şule & Kabak, Özgür & Aktaş, Emel, 2013. "Are road transportation investments in line with demand projections? A gravity-based analysis for Turkey," Transport Policy, Elsevier, vol. 29(C), pages 227-235.

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    Keywords

    Trade Uncertainty Transportation;

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