Rigidities in Transportation and Supply Chain Disruptions

Giulia Brancaccio (), Myrto Kalouptsidi () and Theodore Papageorgiou
Additional contact information
Giulia Brancaccio: New York University
Myrto Kalouptsidi: Harvard University

No 1086, Boston College Working Papers in Economics from Boston College Department of Economics

Abstract: In this paper we provide a simple and intuitive story for supply chain disruptions driven by the rigidities in the transportation sector. Focusing on maritime shipping, we argue that the frequent macroeconomic shocks that shape demand for transportation, meet a highly inelastic supply curve for transportation services. The steepness is driven by equilibrium bottlenecks in ships (transportation agents) and ports (transportation infrastructure). This leads to highly volatile shipping prices and port congestion, affecting importers and exporters worldwide. We discuss how both global trade and inflation react to these costs, so that disruptions pass through to the entire economy.

Keywords: supply chain disruptions; transportation; infrastructure; ports; ships; congestion (search for similar items in EconPapers)
JEL-codes: E30 F0 L0 L90 L91 R4 (search for similar items in EconPapers)
Date: 2025-01-31
New Economics Papers: this item is included in nep-tre
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://fmwww.bc.edu/EC-P/wp1086.pdf main text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:boc:bocoec:1086

Access Statistics for this paper

More papers in Boston College Working Papers in Economics from Boston College Department of Economics Boston College, 140 Commonwealth Avenue, Chestnut Hill MA 02467 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Christopher F Baum ().