City Research Online

Disentangling Demand and Supply Shocks in the Shipping Freight Market: their Impact on Shipping Investments

Nomikos, N. ORCID: 0000-0003-1621-2991 & Tsouknidis, D. (2022). Disentangling Demand and Supply Shocks in the Shipping Freight Market: their Impact on Shipping Investments. Maritime Policy & Management, doi: 10.1080/03088839.2021.2017041

Abstract

We show that demand shocks have a greater effect on real freight rates compared to supply (fleet) shocks both historically and on impact. By contrast, supply shocks have a larger impact on net contracting activity when compared to demand shocks. This paper disentangles for the first time demand and supply shocks driving shipping freight markets and assesses their impact on net contracting activity, a key measure of shipping investments. In the process, we construct novel indices of demand for shipping transportation. Policy related issues are quantified through drawing forecast scenarios for the response of real freight rates to unexpected demand and supply changes.

Publication Type: Article
Additional Information: This is an Accepted Manuscript version of the following article, accepted for publication in Maritime Policy & Management. Nikos K. Nomikos & Dimitris A. Tsouknidis (2022) Disentangling demand and supply shocks in the shipping freight market: their impact on shipping investments, Maritime Policy & Management. It is deposited under the terms of the Creative Commons Attribution-NonCommercial License (http://creativecommons.org/licenses/by-nc/4.0/), which permits non-commercial re-use, distribution, and reproduction in any medium, provided the original work is properly cited
Publisher Keywords: hipping freight rates; demand and supply shocks; net contracting; structural VAR.
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HG Finance
Departments: Bayes Business School > Finance
[img] Text - Accepted Version
This document is not freely accessible until 3 July 2023 due to copyright restrictions.
Available under License Creative Commons Attribution Non-commercial.

To request a copy, please use the button below.

Request a copy

Export

Downloads

Downloads per month over past year

View more statistics

Actions (login required)

Admin Login Admin Login