Endogenous Transport Prices and Trade Imbalances

Arbeitspapier

According to economic theory, imbalances in trade flows affect transport prices because (some) carriers have to return without cargo from the low demand region to the high demand region. Therefore, transport prices in the high demand direction have to exceed those in the low demand direction. This implies that transport costs, and therefore trade costs, are fundamentally endogenous with respect to trade imbalances. We study this effect using transport prices for the inland waterway transport market in north-west Europe. We find that imbalances in trade flows have substantial effects on transport prices. We estimate that a one standard deviation increase in the trade imbalance from region A to region B decreases transport prices from A to B by about 8 percent.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Tinbergen Institute Discussion Paper ; No. 08-088/3

Classification and Topics

• Classification: Wirtschaft ; Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
• Subject: Imbalances in trade flows ; trade costs ; inland waterway transport market ; Außenwirtschaftliches Gleichgewicht ; Transportkosten ; Binnenschifffahrt ; Westeuropa

Contributors, Location and Time

• Event: Geistige Schöpfung
• (who): Jonkeren, Olaf ; Demirel, Erhan ; van Ommeren, Jos ; Rietveld, Piet
• Event: Veröffentlichung
• (who): Tinbergen Institute
• (where): Amsterdam and Rotterdam
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/86776
• Last update: 10.03.2025, 11:41 AM CET