[Seminaire CREM] Determinants of Port Connectivity: The Role of Hinterland Economic Size and Spatial Spillovers in European Ports. - Faculté Des Sciences Economiques

Determinants of Port Connectivity: The Role of Hinterland Economic Size and Spatial Spillovers in European Ports.

In this paper, we undertake a comprehensive analysis of the key determinants of port connectivity focusing on the influence of spatial relationships between ports and the regional reach of their hinterlands, determined by the economic size of the domestic market. Our focus lies on investigating spatial spillover effects originating from both local (captive) and distant (contestable) hinterlands. The study focuses on 92 European container ports, using a panel data set covering a 14-year period from 2006 to 2019. Port connectivity is represented by the Port Liner Shipping Connectivity Index (PLSCI) of the UNCTAD database, which indicates a port's position in the global container transport network. Utilizing the Durbin Spatial Model (SDM), our study explores the influence of various factors such as regional GDP, relative port size, specialization, partner diversification, and transshipment activity intensity on port connectivity. The results indicate that ports serving large hinterlands with substantial domestic demand have higher levels of connectivity. In addition, the study reveals that the diversification of trading partners and the intensity of transshipment center activities have a significant impact on port connectivity. Conversely, ports specializing in dry and liquid goods show lower levels of connectivity. This study underlines the crucial role of hinterland market demand in improving port connectivity, highlighting its substantial influence beyond the immediate proximity of ports. This information should inform stakeholders' strategies to capitalize on regional hinterland synergies and promote collaboration between neighboring ports to enhance port connectivity.