Frontier Advanced Seminar Series in Economics No. 14

Trade From Space: Shipping Networks and The Global Implications of Local Shocks

Speaker: Assistant Professor of Yuan ZI (Geneva Institute of International Relations and Development)

Host: Prof. Anzhou ZHANG (Liaoning University)

Introducer: Prof. Xiangjun MA(Liaoning University)

Time: May 23, 2023 (Tuesday), 14:00-15:30 (UTC +08:00)

Venue: Conference Room on the base floor of Wuzhou Garden, Chongshan Campus, Liaoning University

Online Venue: Tencent Meeting (Meeting ID: 300 7551 6895)

Language: Mandarin

Abstract：This paper analyzes international externalities of a local shock to the global shipping network. The 2016 Panama Canal expansion removed a bottleneck in seaborne transportation, allowing much larger ships to pass. Using both reduced-form and structural methods in combination with novel satellite data on the movements of container ships, we find that trade increased significantly among country-pairs using the canal. We find that the global real income gains from the canal expansion were over three times greater than the income gains for Panama itself. A link removal analysis reveals that most shipping links are associated with positive and quantitatively important positive international externalities.