The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade Value
The purpose of this study is to empirically analyze the impact of logistics efficiency on trade volume growth, and to examine the effects of lower tariffs resulting from free trade agreements. In order to measure the impact of logistics efficiency on trade volume growth, the export and import trade...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Emerald Publishing
2016-12-01
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| Series: | Journal of International Logistics and Trade |
| Online Access: | https://www.emerald.com/insight/content/doi/10.24006/jilt.2016.14.3.211/full/pdf |
| _version_ | 1797612267836014592 |
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| author | Kyong Han Lee Sang-Yoon Lee |
| author_facet | Kyong Han Lee Sang-Yoon Lee |
| author_sort | Kyong Han Lee |
| collection | DOAJ |
| description | The purpose of this study is to empirically analyze the impact of logistics efficiency on trade volume growth, and to examine the effects of lower tariffs resulting from free trade agreements. In order to measure the impact of logistics efficiency on trade volume growth, the export and import trade volume among 53 countries was introduced as the dependent variable. Macroeconomic indicators including annual average tariff rate, logistics efficiency indicators for port, air, railroad, road and container vessel connectivity, as well as dummy variables such as whether a free trade agreement was signed, were introduced as the explanatory variables. Bilateral panel data between trading nations was used to estimate the gravity panel model, and analysis followed the categorization: 1) separate inputs of the five logistics efficiency variables and 2) one aggregated input of the five variables as a single indicator. The analysis found that logistics efficiency had a statistically significant impact on bilateral trade volume growth, while the impact of lowering tariff rates on increasing trade was insignificant. In addition, logistics efficiency was found to have a greater impact on increasing trade volume than free trade agreements. These results imply that trade can be promoted more effectively by establishing and efficiently operating logistics-related infrastructure rather than traditional methods of reducing trade barriers such as lowering tariffs and signing free trade agreements. |
| first_indexed | 2024-03-11T06:38:53Z |
| format | Article |
| id | doaj.art-6fa4518f311744d6a101c3bdef0fdb33 |
| institution | Directory Open Access Journal |
| issn | 1738-2122 2508-7592 |
| language | English |
| last_indexed | 2024-03-11T06:38:53Z |
| publishDate | 2016-12-01 |
| publisher | Emerald Publishing |
| record_format | Article |
| series | Journal of International Logistics and Trade |
| spelling | doaj.art-6fa4518f311744d6a101c3bdef0fdb332023-11-17T10:43:31ZengEmerald PublishingJournal of International Logistics and Trade1738-21222508-75922016-12-0114321121810.24006/jilt.2016.14.3.211The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade ValueKyong Han Lee0Sang-Yoon Lee1aKorea Maritime Institute, Busan, KoreacAsia Pacific School of Logistics, Inha University, Incheon, KoreaThe purpose of this study is to empirically analyze the impact of logistics efficiency on trade volume growth, and to examine the effects of lower tariffs resulting from free trade agreements. In order to measure the impact of logistics efficiency on trade volume growth, the export and import trade volume among 53 countries was introduced as the dependent variable. Macroeconomic indicators including annual average tariff rate, logistics efficiency indicators for port, air, railroad, road and container vessel connectivity, as well as dummy variables such as whether a free trade agreement was signed, were introduced as the explanatory variables. Bilateral panel data between trading nations was used to estimate the gravity panel model, and analysis followed the categorization: 1) separate inputs of the five logistics efficiency variables and 2) one aggregated input of the five variables as a single indicator. The analysis found that logistics efficiency had a statistically significant impact on bilateral trade volume growth, while the impact of lowering tariff rates on increasing trade was insignificant. In addition, logistics efficiency was found to have a greater impact on increasing trade volume than free trade agreements. These results imply that trade can be promoted more effectively by establishing and efficiently operating logistics-related infrastructure rather than traditional methods of reducing trade barriers such as lowering tariffs and signing free trade agreements.https://www.emerald.com/insight/content/doi/10.24006/jilt.2016.14.3.211/full/pdf |
| spellingShingle | Kyong Han Lee Sang-Yoon Lee The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade Value Journal of International Logistics and Trade |
| title | The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade Value |
| title_full | The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade Value |
| title_fullStr | The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade Value |
| title_full_unstemmed | The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade Value |
| title_short | The Impact of Logistics Efficiency and Free Trade Agreements on Global Trade: Focusing on Total Trade Value |
| title_sort | impact of logistics efficiency and free trade agreements on global trade focusing on total trade value |
| url | https://www.emerald.com/insight/content/doi/10.24006/jilt.2016.14.3.211/full/pdf |
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