Integrating Logistics into Global Production: A New Approach

Pablo Coto-Millán, David Paz Saavedra (), Marta de la Fuente and Xose Luis Fernandez
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Pablo Coto-Millán: Department of Economy, University of Cantabria, 39005 Santander, Spain
David Paz Saavedra: Department of Economy, University of Cantabria, 39005 Santander, Spain
Marta de la Fuente: Department of Economy, University of Cantabria, 39005 Santander, Spain
Xose Luis Fernandez: Department of Economy, University of Cantabria, 39005 Santander, Spain

Logistics, 2024, vol. 8, issue 4, 1-9

Abstract: Background: Logistics has become a key driver of global economic production. This study investigates the role of logistics in global economic production by presenting a novel theoretical framework that integrates logistics performance into traditional models as a determinant production factor. Methods: Using panel data from 85 countries between 2007 and 2022, the research measures logistics performance through the Logistics Performance Index ( L P I ). Results: The analysis reveals that logistics performance, specifically factors such as customs efficiency, infrastructure quality, and tracking and tracing of shipments, significantly enhances global economic output. On the other hand, negative elasticities were observed for shipment timeliness and the cost competitiveness of international shipments, suggesting that inefficiencies in these areas can hinder economic growth. Conclusions: The findings underscore the need for targeted public policies to improve logistics infrastructure and efficiency, particularly in customs and trade logistics, to increase global production. Additionally, the study highlights the potential for improving the logistics sector to support sustainable development and economic interdependence among countries. This research provides important insights for policymakers and managers, indicating that effective logistics management can drive substantial improvements in production efficiency and overall economic performance.

Keywords: global production; production function; logistics performance index; fixed effects model; random effects model (search for similar items in EconPapers)
JEL-codes: L8 L80 L81 L86 L87 L9 L90 L91 L92 L93 L98 L99 M1 M10 M11 M16 M19 R4 R40 R41 R49 (search for similar items in EconPapers)
Date: 2024
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