EconStor >
Georg-August-Universität Göttingen >
Ibero-Amerika-Institut für Wirtschaftsforschung (IAI), Universität Göttingen >
Discussion Papers, IAI, Universität Göttingen >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/57301
  
Title:How costly is modern maritime piracy for the international community? PDF Logo
Authors:Martínez-Zarzoso , Inmaculada
Bensassi, Sami
Issue Date:2010
Series/Report no.:Discussion papers, Ibero America Institute for Economic Research 208
Abstract:This paper focuses on the impact of maritime piracy on international trade. Piracy increases the cost of international maritime transport through an increase in insecurity regarding goods deliveries. Bilateral trade flows between the main European and Asian countries over the 1999 to 2008 period are used to estimate an augmented gravity model that includes various measures of piracy acts. We found robust evidence indicating that maritime piracy reduces the volume of trade; the effect of ten additional vessels hijacked being associated to an 11% decrease in exports. Using these results, the international cost of piracy in terms of trade destruction is estimated to be 28 billion dollars. Finally, we compare the cost of low intensity conflict like Somalia, to the cost of a full scale conflict (Afghanistan) and to the cost of an autarkic state (North Korea) for the international community in the year 2008.The results indicate that the cost of war more than doubles the cost of low intensity conflict.
Subjects:piracy
international trade
gravity equation
cost of conflict
security
JEL:F10
F51
Document Type:Working Paper
Appears in Collections:Discussion Papers, IAI, Universität Göttingen

Files in This Item:
File Description SizeFormat
64377727X.pdf1.12 MBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/57301

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.