Scenario Analysis of Shipping Networks: Consolidation

Francesca Romana Medda, Francesco Caravelli, Simone Caschili and Alan Wilson
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Francesca Romana Medda: University College London
Francesco Caravelli: University College London
Simone Caschili: University College London
Alan Wilson: University College London

Chapter Chapter 6 in Collaborative Approach to Trade, 2017, pp 65-82 from Springer

Abstract: Abstract According to the Pacific Islands Forum Secretariat (2012), the shipping market in the SPICs is relatively contestable. Nonetheless, the trade flows are extremely imbalanced since imports usually far outweigh exports, and the freight rates are often significantly higher than in other parts of the world (ADB 2013). These inefficiencies in the trade markets certainly stem from the intrinsic spatial dispersion of the islands, their physical scale, thin trade flows, chronic infrastructure difficulties (above all relating to maintenance and operations) and limited trade connectivity in the domestic and international market. However, the available empirical evidence does not clearly address the entirety of the interrelated aspects which hamper trade, and for this reason we develop a scenario analysis in this chapter based on the topological structure of shipping networks in the SPICs. The objectives are to explore how to stimulate the consolidation of cargo and decrease transport cost by achieving economies of scale through the network structure. These objectives relate to our general hypothesis (1) in Chap. 4 : Can the structure of the shipping network stimulate the consolidation of cargo and decrease transport cost?

Keywords: Transport Cost; Discount Factor; Shipping Network; Trade Flow; Shipping Company (search for similar items in EconPapers)
Date: 2017
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DOI: 10.1007/978-3-319-47039-9_6

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