An Analysis of the Dynamic Relationship between the Global Macroeconomy and Shipping and Shipbuilding Industries

Using time-series data from January 2006 to February 2021, this study analyzed the effect of macroeconomic shocks on the shipping and shipbuilding industries. The Granger causality test, recursive structural vector autoregressive models, impulse response analysis, historical decomposition, and local projections model were used to identify the dynamic relationships between the variables and their dynamic effects, based on the results of the theoretical model and previous research. First, the Granger causality test demonstrated that the macroeconomic variables have causal relations with the shipping and shipbuilding industries. Second, the recursive structural vector autoregressive estimation demonstrated that the direction of the shocks from macroeconomic variables is statistically significantly, consistent with the theoretical model. The same results were found in the recursive structural vector autoregressive model and local projection impulse response analysis. Finally, the historical decomposition identified the main causal variables affecting the shipping and shipbuilding industries by period. These findings can help policymakers, operators of shipping and shipbuilding companies, and investors evaluate and make policy-supporting decisions on industry conditions.