The Local Impact of Containerization

71 Pages Posted: 13 Jul 2018 Last revised: 21 Feb 2019

See all articles by Leah Brooks

Leah Brooks

George Washington University - Trachtenberg School of Public Policy and Public Administration

Nicolas Gendron-Carrier

University of Toronto

Gisela Rua

University of California, Berkeley - Department of Economics; Board of Governors of the Federal Reserve System

Date Written: July, 2018

Abstract

We investigate how containerization impacts local economic activity. Containerization is premised on a simple insight: packaging goods for waterborne trade into a standardized container makes them dramatically cheaper to move. We use a novel cost-shifter instrument -- port depth pre-containerization -- to contend with the non-random adoption of containerization by ports. Container ships sit much deeper in the water than their predecessors, making initially deep ports cheaper to containerize. Consistent with New Economic Geography models, we find that counties near container ports grow an additional 70 percent from 1950 to 2010. Gains predominate in counties with initially low population density and manufacturing.

JEL Classification: F63, R11, F15

Suggested Citation

Brooks, Leah and Gendron-Carrier, Nicolas and Rua, Gisela and Rua, Gisela, The Local Impact of Containerization (July, 2018). FEDS Working Paper No. 2018-45, Available at SSRN: https://ssrn.com/abstract=3213282 or http://dx.doi.org/10.17016/FEDS.2018.045

Leah Brooks (Contact Author)

George Washington University - Trachtenberg School of Public Policy and Public Administration ( email )

805 21st Street, NW
Suite 601
Washington, DC 20052
United States

Nicolas Gendron-Carrier

University of Toronto ( email )

Toronto, M5S 3G8
Canada

Gisela Rua

University of California, Berkeley - Department of Economics ( email )

549 Evans Hall #3880
Berkeley, CA 94720-3880
United States

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

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