Economics of Sea Transport and International Trade اقتصاديات النقل والتجارة الدولية


This course answers several critical questions for improving the participant ability to make profitable decisions in the area of sea transport and international trade. Examples of topics will be covered are: Basic economic concepts, the demand for shipping, the supply of shipping, cost analysis and economies of scale, competitive markets (tramps and tankers), liner trades (oligopoly and the competitive market), ports, canals and waterways, shipping and international trade, and exchange rates and balance of payments


To enhance the participants’ knowledge, skills and abilities necessary to understand economics of sea transport and international trade


By the end of the course the participant will be able to:

  • Understand the economic theory of shipping and international trade

  • develop analytical skills and relate theory to empirical evidence

  • communicate effectively through the use of graphs and have an appreciation of statistical evidence


  • Basic Economic Concepts
  • Definitions of Economics and Maritime Economics.
  • Micro Economic Theory of Shipping and Macro Economic Factors Affecting International Trade and Shipping.
  • Factors of Production, Utility and Price and Opportunity Cost.
  • Price Mechanism and the Relationship between Demand, Price and Quantity.
  • Competitive Models and Demand Factors.
  • The Demand for Shipping
  • How the Demand for Shipping Arises.
  • Basic Measures of Economic Activity (GNP and GDP)
  • Derived Demand, Elasticity of Demand and the Relevance of Elasticity.
  • Demand Measurement – Distance, Ton/Miles and Tones / Kilometers.
  • The Supply of Shipping
  • Factors Influencing the Supply Of Shipping.
  • Trends in Development of the World Fleet, Newbuildings and Scrapping.
  • Productivity and Supply Trends.
  • Short and Long Run Supply, Supply Responsiveness and the Concept of Elasticity.
  • Cost Analysis and Economies of Scale
  • Economic Cost Concepts
  • Conventional Cost Analysis in Shipping
  • Specific Factors Affecting the Relationship between Costs and Shipping Output.
  • Economies of Scale in Shipping and Optimal Ship Size.
  • Factors Affecting Costs: Fiscal Regimes and Flag of Registry.
  • Costs and Quality.
  • Competitive Markets: Tramps
  • Dry Cargo Market Structure and Characteristics.
  • Market Demand Structure and the Concept of Perfect Competition.
  • Voyage Estimating and Breakeven Analysis as a Tool for Determining Minimum Freight Rates and the Lay up Decision.
  • Cost Structure of Tramp Ships.
  • Competitive Markets: Tankers
  • The Structure of the Tanker Market and the Seaborne Trade in Crude and Products.
  • The Imbalance of Ownership, Identical Service, Freedom of Entry and Exit, Full Information and Segmented Supply.
  • The Tanker and Dry Markets.
  • Political and Environmental Factors.
  • Recent Changes in the Tanker Fleet and Fluctuations in Freight Market Indices.
  • Liner Trades: Oligopoly and the Competitive Market
  • Characteristics and Demand for Liner Services
  • Trends in Liner Markets and Ship Types.
  • Pricing Behavior: Price Discrimination and Profitability and the Empirical Evidence of Lower Profits than Other Shipping Markets.
  • Profit Maximization and Optimal Utilization.
  • The Effect of International Regulation.
  • Customer Demand, the Ability to Meet Customer Demand and Maximize Utilization.
  • Ports, Canals and Waterways
  • Functions of Ports, Canals and Waterways.
  • Efficiency and Cost and the Importance of Ship/Port Time.
  • Investment: Criteria and Economic Factors Including Cost and Tariff Structure.
  • Shipping and International Trade
  • World Trade Patterns.
  • The Demand for Shipping.
  • Types of Trade Flows: Inter-Industry and Intra-Industry; Absolute and Comparative Advantage.
  • Global Trading and the Role of the World Trade Organisation and G8.
  • Exchange Rates and Balance of Payments
  • How Exchange Rates are Determined
  • Free Floating and Regulated Markets.
  • Exchange Rate Fluctuations and Shipping.