IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

The Time Dimension And Value Of Flexibility In Resource Allocation: The Case Of The Maritime Industry

Listed author(s):
  • Axarloglou, Kostas

    (Democritus University of Thrace, Department of International Economic Relations and Development)

  • Visvikis, Ilias

    (ALBA Graduate Business School)

  • Zarkos, Stefanos

    (ALBA Graduate Business School)

Registered author(s):

    The paper analyses empirically the time-varying properties of the spread between voyage and time-charter rates and presents evidence that these properties are directly related to the business cycle (market demand) of the maritime industry, to the expectations for the future market demand and to market volatility. Using a real options methodology, we demonstrate that the time-varying properties of the spread is the outcome of the strategic decision to time-commit company resources in the industry. It is shown that, during a market upturn (downturn) managers choose to commit company resources for a short period (long period), and thus, maintain flexibility (commitment) in better exploiting the upcoming business opportunities (protecting company resources from lack of business opportunities). Overall, the fluctuations of the time-varying spread, between voyage and time-charter rates, offer managerial insights in resource allocation that can better shape up chartering, budgeting and financial management decisions on the time commitment of resources in the maritime industry.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://utopia.duth.gr/~pgkogkas/duthwp/2-2012.pdf
    File Function: Full text
    Download Restriction: no

    Paper provided by Democritus University of Thrace, Department of Economics in its series DUTH Research Papers in Economics with number 2-2012.

    as
    in new window

    Length: 28 pages
    Date of creation: 27 Jan 2012
    Handle: RePEc:ris:duthrp:2012_002
    Contact details of provider: Postal:
    Department of Economics, University Campus, Komotini, 69100, Greece

    Phone: (25310) 39.503
    Fax: (25310) 39.502
    Web page: http://www.econ.duth.gr/

    More information through EDIRC

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:ris:duthrp:2012_002. 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: (Periklis Gogas)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.