EconPapers    
Economics at your fingertips  
 

A cross sectional analysis of ship maintenance expenses

George Bitros () and Manolis Kavussanos ()

Macroeconomics from University Library of Munich, Germany

Abstract: This paper introduces an econometric model to explain the determinants of expenditure in ship maintenance and repair. The data refer to 112 vessels of different types that operated in 1999 and were collected from ten Greek ship owning and management companies. On the meth-odological plain the best functional form is obtained when estimating a semi log- linear model. As expected from theory, the empirical results show that maintenance expenditure is positively related to utilization, age, and size. In addition the effect of age is found to be stronger on vessels younger than 20 years. This may be due to the fact that vessels less than 20 years old can be sold more easily in the second-hand market, whereas older vessels have a shorter lifetime and are also constrained by safety regulations. Therefore, ship owners are more reluctant to spend more once the vessel passes its 4th and especially its 5th special survey. To trace the effect of company poli-cies we included in the model company dummy variables. We found that such effects are present particularly when stores expenses are estimated separately. In turn, this suggested that company policies have still some control on maintenance expenses. Another result is that the elasticities of maintenance expenses with respect to utilization, age, and size at least in 1999 were uniformly less than one, thus revealing the existence of significant economies of scale. And still another result is that the type of ship, the flag, the classification and even the yard where maintenance takes place are significant determinants of the respective outlays.

Keywords: ship maintenance expenses; utilization (search for similar items in EconPapers)
JEL-codes: E (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mac
Date: 2005-04-21
Note: Type of Document - pdf; pages: 27
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/mac/papers/0504/0504030.pdf (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:wpa:wuwpma:0504030

Access Statistics for this paper

More papers in Macroeconomics from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ().

 
Page updated 2019-10-22
Handle: RePEc:wpa:wuwpma:0504030