DP15956 Dry Bulk Shipping and the Evolution of Maritime Transport Costs, 1850-2020
|Author(s):||David S. Jacks, Martin Stürmer|
|Publication Date:||March 2021|
|Keyword(s):||Dry bulk, maritime freight rates, structural VAR|
|JEL(s):||E30, N70, R40|
|Programme Areas:||Economic History|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=15956|
We provide evidence on the dynamic effects of fuel price shocks, shipping demand shocks, and shipping supply shocks on real dry bulk freight rates in the long run. We first analyze a new dataset on dry bulk freight rates for the period from 1850 to 2020, finding that they followed a downward but undulating path with a cumulative decline of 79%. Next, we turn to understanding the drivers of booms and busts in the dry bulk shipping industry, finding that shipping demand shocks strongly dominate all others as drivers of real dry bulk freight rates in the long run. Furthermore, while shipping demand shocks have increased in importance over time, shipping supply shocks in particular have become less relevant.