Where Has the Rum Gone? Firms’ Choice of Transport Mode under the Threat of Maritime Piracy

Alexander-Nikolai Sandkamp and Shuyao Yang

No 271, ifo Working Paper Series from ifo Institute - Leibniz Institute for Economic Research at the University of Munich

Abstract: Despite a general agreement that piracy poses a significant threat to maritime shipping, empirical evidence regarding its economic consequences remains scarce. This paper takes a step towards filling the gap by combining firm-level Chinese customs data with information on pirate attacks to investigate how exporting firms respond to maritime piracy. It finds that overall exports along a particular shipping route fall following an increase in pirate activity. In addition, piracy induces firms to switch from ocean to air shipping, while the remaining ocean shipments become larger.

JEL-codes: F14 F19 N70 R41 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-int and nep-tre
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