Attention Economy


Tuesday, December 17, 2024

History Lesson: Suez Canal and Trade Costs

Suez
https://www.nber.org/system/files/working_papers/w33250/w33250.pdf
For all its importance, there still is no comprehensive quantitative assessment of the Suez Canal’s opening in 1869. We find that it led to a 72% relative increase in bilateral exports for affected country pairs and a likely permanent increase in world trade. With respect to the composition of trade, Suez was associated with large changes in export shares but only for a handful of goods categories. With respect to mechanisms, the relative cost of using steamships on Suez-affected routes fell dramatically and immediately after 1869, suggesting a vital role for the canal in the global diffusion of steam technology.
 
Trade costs and the Suez and Panama Canals
https://www.cepii.fr/PDF_PUB/wp/2016/wp2016-29.pdf