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The role of insurance in international shipping costs

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  • Wolanski, Adrian

Abstract

We estimate insurance costs for international shipments, and determine that distance does not affect insurance costs. This corroborates empirical observations of the Alchian–Allen effect. We also show that GDP per capita is endogenously related to unit value through insurance costs.

Suggested Citation

  • Wolanski, Adrian, 2017. "The role of insurance in international shipping costs," Economics Letters, Elsevier, vol. 155(C), pages 116-120.
    • Handle: RePEc:eee:ecolet:v:155:y:2017:i:c:p:116-120
    DOI: 10.1016/j.econlet.2017.03.025
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    References listed on IDEAS

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    1. James E. Anderson & Eric van Wincoop, 2004. "Trade Costs," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 691-751, September.
    2. David Hummels & Alexandre Skiba, 2004. "Shipping the Good Apples Out? An Empirical Confirmation of the Alchian-Allen Conjecture," Journal of Political Economy, University of Chicago Press, vol. 112(6), pages 1384-1402, December.
    3. Hummels, David & Lugovskyy, Volodymyr & Skiba, Alexandre, 2009. "The trade reducing effects of market power in international shipping," Journal of Development Economics, Elsevier, vol. 89(1), pages 84-97, May.
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    Cited by:

    1. Wang, Haijun & Tan, Jie & Guo, Shuojia & Wang, Shenhao, 2018. "High-value transportation disruption risk management: Shipment insurance with declared value," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 109(C), pages 293-310.

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