Capacity retirement in the dry bulk market: A vessel based logit model

Amir H. Alizadeh, Siri Strandenes and Helen Thanopoulou

Transportation Research Part E: Logistics and Transportation Review, 2016, vol. 92, issue C, 28-42

Abstract: The paper investigates the effect of vessel specific and market variables on the probability of scrapping dry bulk ships. Using a dataset from 2012 to 2015, we find that the probability of scrapping increases with age, but that the relation between vessel size and scrapping probability varies across the different segments. In addition, while the relation between earnings and probability of scrapping ships is negative, bunker prices seem to affect only the scrapping rate of smaller tonnage. Scrapping probability also increases with an increase in interest rates, freight market volatility and scrap steel prices.

Keywords: Capacity retirement; Scrapping probability; Dry bulk market; Logit; Shipping crisis (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:transe:v:92:y:2016:i:c:p:28-42

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DOI: 10.1016/j.tre.2016.03.005

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