Estimating the Effects of the Container Revolution on World Trade
The introduction of containerization triggered complementary technological and organizational changes that revolutionized global freight transport. Despite numerous claims about the importance of containerization in stimulating international trade, econometric estimates on the effects of containerization on trade appear to be missing. Our paper fills this gap in the literature. Our key idea is to exploit time and cross-sectional variation in countries’ adoption of port or railway container facilities to construct a time-varying bilateral technology variable and estimate its effect on explaining variations in bilateral product level trade flows in a large panel for the period 1962-1990. Our estimates suggest that containerization did not only stimulate trade in containerizable products (like auto parts) but also had complementary effects on non-containerizables (like automobiles). As expected, we find larger effects on North-North trade than on North-South or South-South trade and much smaller effects when ignoring railway containerization. Regarding North-North trade, the cumulative average treatment effects of containerization over a 20 year time period amount to about 700%, can be interpreted as causal, and are much larger than the effects of free trade agreements or the GATT. In a nutshell, we provide the first econometric evidence for containerization to be a driver of 20th century economic globalization.
|Date of creation:||15 Feb 2013|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +46 +46 222 0000
Fax: +46 +46 2224613
Web page: http://www.nek.lu.se/en
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Theo Notteboom & Jean-Paul Rodrigue, 2008. "Containerisation, Box Logistics and Global Supply Chains: The Integration of Ports and Liner Shipping Networks," Maritime Economics and Logistics, Palgrave Macmillan, vol. 10(1-2), pages 152-174, March.
- Clark, Ximena & Dollar, David & Micco, Alejandro, 2004.
"Port efficiency, maritime transport costs, and bilateral trade,"
Journal of Development Economics,
Elsevier, vol. 75(2), pages 417-450, December.
- Ximena Clark & David Dollar & Alejandro Micco, 2004. "Port Efficiency, Maritime Transport Costs and Bilateral Trade," NBER Working Papers 10353, National Bureau of Economic Research, Inc.
- Kei-Mu Yi, 2000.
"Can vertical specialization explain the growth of world trade?,"
96, Federal Reserve Bank of New York.
- Kei-Mu Yi, 2003. "Can Vertical Specialization Explain the Growth of World Trade?," Journal of Political Economy, University of Chicago Press, vol. 111(1), pages 52-102, February.
- David Hummels, 2007. "Transportation Costs and International Trade in the Second Era of Globalization," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 131-154, Summer.
- Mokyr, Joel, 1992. "The Lever of Riches: Technological Creativity and Economic Progress," OUP Catalogue, Oxford University Press, number 9780195074772.
- Bruce A. Blonigen & Wesley W. Wilson, 2008. "Port Efficiency and Trade Flows," Review of International Economics, Wiley Blackwell, vol. 16(1), pages 21-36, 02.
- Baier, Scott L. & Bergstrand, Jeffrey H., 2001. "The growth of world trade: tariffs, transport costs, and income similarity," Journal of International Economics, Elsevier, vol. 53(1), pages 1-27, February.
- Robert C. Feenstra & Robert E. Lipsey & Haiyan Deng & Alyson C. Ma & Hengyong Mo, 2005. "World Trade Flows: 1962-2000," NBER Working Papers 11040, National Bureau of Economic Research, Inc.
- Baier, Scott L. & Bergstrand, Jeffrey H., 2007.
"Do free trade agreements actually increase members' international trade?,"
Journal of International Economics,
Elsevier, vol. 71(1), pages 72-95, March.
- Scott L. Baier & Jeffrey H. Bergstrand, 2005. "Do free trade agreements actually increase members’ international trade?," FRB Atlanta Working Paper No. 2005-03, Federal Reserve Bank of Atlanta.
When requesting a correction, please mention this item's handle: RePEc:hhs:lunewp:2013_004. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David Edgerton)
If references are entirely missing, you can add them using this form.