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All aboard: the effects of port development

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  • Ducruet, César
  • Juhasz, Reka
  • Nagy, Dávid Krisztián
  • Steinwender, Claudia

Abstract

Seaports facilitate the fast flow of goods across space, but ports also entail local costs borne by host cities. We use the introduction of containerized shipping to explore the effects of port development. At the local level, we find that seaport development increases city population by making a city more attractive, but this market access effect is offset by costs which make the city less attractive. At the aggregate level, we find that the local costs associated with port development are heterogeneous across cities and reduce aggregate welfare gains, which however are still positive and substantial.

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  • Ducruet, César & Juhasz, Reka & Nagy, Dávid Krisztián & Steinwender, Claudia, 2020. "All aboard: the effects of port development," LSE Research Online Documents on Economics 108496, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:108496
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    Cited by:

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    2. Deda Đelović, 2024. "Considerations on Prevention of Pollution from Ships in a Seaport," Sustainability, MDPI, vol. 16(12), pages 1-24, June.
    3. Gray, Rowena & Wright, Greg C., 2024. "A rising tide? The local incidence of the second wave of globalization," Journal of International Economics, Elsevier, vol. 148(C).
    4. Sharat Ganapati & Woan Foong Wong & Oren Ziv, 2024. "Entrepôt: Hubs, Scale, and Trade Costs," American Economic Journal: Macroeconomics, American Economic Association, vol. 16(4), pages 239-278, October.
    5. Mounir Amdaoud & César Ducruet & Marc-Antoine Faure, 2021. "Port-city linkages and multi-level hinterlands: the case of France," EconomiX Working Papers 2021-29, University of Paris Nanterre, EconomiX.
    6. Cheng, Cheng & Wang, Xiaobing, 2021. "Transportation cost reducing technological change and wages inequalities," Structural Change and Economic Dynamics, Elsevier, vol. 59(C), pages 600-611.
    7. Stephan Maurer & Ferdinand Rauch, 2023. "Economic geography aspects of the Panama Canal," Oxford Economic Papers, Oxford University Press, vol. 75(1), pages 142-162.
    8. Stephen J. Redding, 2020. "Trade and Geography," NBER Working Papers 27821, National Bureau of Economic Research, Inc.
    9. Mounir Amdaoud & César Ducruet & Marc‐Antoine Faure, 2022. "The mutual specialization of port and urban functions: The case of France," Papers in Regional Science, Wiley Blackwell, vol. 101(2), pages 439-460, April.
    10. Brooks, Leah & Gendron-Carrier, Nicolas & Rua, Gisela, 2021. "The local impact of containerization," Journal of Urban Economics, Elsevier, vol. 126(C).
    11. Maria Waldinger, 2024. "“Let them eat cake”: drought, peasant uprisings, and demand for institutional change in the French Revolution," Journal of Economic Growth, Springer, vol. 29(1), pages 41-77, March.
    12. Dávid Krisztián Nagy, 2021. "Quantitative Economic Geography Meets History: Questions, Answers and Challenges," Working Papers 1249, Barcelona School of Economics.
    13. Nagy, Dávid Krisztián, 2022. "Quantitative economic geography meets history: Questions, answers and challenges," Regional Science and Urban Economics, Elsevier, vol. 94(C).
    14. Woan Foong Wong & Simon Fuchs, 2022. "Multimodal Transport Networks," FRB Atlanta Working Paper 2022-13, Federal Reserve Bank of Atlanta, revised Oct 2024.
    15. Kalouptsidi, Myrto & Brancaccio, Giulia & Papageorgiou, Theodore & Rosaia, Nicola, 2020. "Search Frictions and Efficiency in Decentralized Transport Markets," CEPR Discussion Papers 14827, C.E.P.R. Discussion Papers.
    16. Hirte, Georg & Lessmann, Christian & Seidel, André, 2020. "International trade, geographic heterogeneity and interregional inequality," European Economic Review, Elsevier, vol. 127(C).
    17. Wookun Kim, 2023. "Migration, Commuting, and the Spatial Distribution of Public Spending," Departmental Working Papers 2305, Southern Methodist University, Department of Economics.
    18. David Krisztián Nagy, 2020. "Trade and urbanization: Evidence from Hungary," Economics Working Papers 1858, Department of Economics and Business, Universitat Pompeu Fabra.
    19. Ulltveit-Moe, Karen Helene & Heiland, Inga & Moxnes, Andreas & Zi, Yuan, 2019. "Trade From Space: Shipping Networks and The Global Implications of Local Shocks," CEPR Discussion Papers 14193, C.E.P.R. Discussion Papers.
    20. David Krisztián Nagy, 2020. "Quantitative economic geography meets history: Questions, answers and challenges," Economics Working Papers 1774, Department of Economics and Business, Universitat Pompeu Fabra, revised Mar 2021.

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    More about this item

    Keywords

    ports; containerization; quantitative economic geography; endogenous trade costs;
    All these keywords.

    JEL classification:

    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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