Economies of size of large containerships based on internal and external costs

Simme Veldman, Cees Glansdorp and Robert Kok

International Journal of Decision Sciences, Risk and Management, 2011, vol. 3, issue 3/4, 384-400

Abstract: Economies and diseconomies of ship size express the change of shipping costs as a function of ship size. In an earlier publication by one of the authors the impact of increasing containership size on unit shipping costs up to 20,000 TEU was elaborated. This paper expands in two directions. The first is to include ship design parameters to support statements on future containership particulars with respect to size, dimensions, speed and engine power, rather than just extrapolating them either explicitly or implicitly. The second is to include external costs related to the effects of CO₂ emissions on climate change. Discussions on the monetary value of these emissions are in full swing. This paper therefore applies a plausible bandwidth. Results of the analysis show that economies of ships size continue to exist for ships up to 25,000 TEU, but those technical limitations with respect to propulsion, engine power and cavitations put the maximum size of a single propeller ship at a lower level.

Keywords: ship size economies; external costs; double propeller; single propeller; CO2; carbon dioxide; carbon emissions; large container ships; decision sciences; shipping costs; climate change; ship dimensions; ship speed; engine power. (search for similar items in EconPapers)
Date: 2011
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