The Impact of Technological Change on New Trade: Evidence from the Container Revolution

27 Pages Posted: 25 Oct 2016

See all articles by Daniel M. Bernhofen

Daniel M. Bernhofen

American University - School of International Service; American University; American University - School of International Service

Zouheir El-Sahli

Lund University

Richard Kneller

University of Nottingham

Date Written: September 15, 2016

Abstract

This paper exploits exogenous features of the 1960s/70s container revolution to estimate the impact of the introduction of refrigerated containers (or reefers) on new trade of temperature sensitive products. Our identification strategy is justified by a historical narrative which suggests that the containerization of bilateral trading routes was exogenous to the growth of trade in ‘reefer commodities’ and stimulated trade in non-traditional (exotic) non-bulk commodities such as pharmaceuticals, photo film and sensitive instruments. Our study combines previously collected data on variations in the container usage on bilateral trade routes with newly collected data on temperature sensitivity and applies them to 5-digit product level trade flows. Our benchmark estimates suggest that the introduction of reefer containers caused an increase in the likelihood of new trade in temperature sensitive products of 9% during 1968 and 1973 and 13% between 1968 and 1978.

Keywords: trade in temperature-sensitive products, extensive margin, impact of refrigerated containers

JEL Classification: F130, N700

Suggested Citation

Bernhofen, Daniel M. and El-Sahli, Zouheir and Kneller, Richard, The Impact of Technological Change on New Trade: Evidence from the Container Revolution (September 15, 2016). CESifo Working Paper Series No. 6069. Available at SSRN: https://ssrn.com/abstract=2858775

Daniel M. Bernhofen (Contact Author)

American University - School of International Service ( email )

4400 Massachusetts Ave, NW
Washington, DC 20016
United States
2028856721 (Phone)

American University ( email )

4400 Massachusetts Av NW
Washington, DC 20015
United States
202-885-6721 (Phone)

HOME PAGE: http://www.american.edu/sis/faculty/dbernhof.cfm

American University - School of International Service ( email )

4400 Massachusetts Ave, NW
Washington, DC 20016
United States
2028856721 (Phone)

Zouheir El-Sahli

Lund University ( email )

Box 117
Lund, SC Skane S221 00
Sweden

Richard Kneller

University of Nottingham ( email )

University Park
Nottingham, NG8 1BB
United Kingdom

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