Individual members of a business system are affected by changes observed by any other member of that system, the effect of which could be positive or negative. The Maritime Industry forms part of such a system. Changes in behaviour or policy impinge on dramatic variances in performance in a matter of days. The changes are not limited to that of 'International Maritime Policy' but also changes in other areas of business. There are varying opinions and arguments as regards the effect of such changes on The Maritime Industry and if changes in policy are necessary depending on the aforesaid effects. This essay highlights the Economic Theories and the effect that they have on policy makers in the Shipping Industry as regards safety and protection of the environment. The most basic concepts would include Social Costs, Market Failures, Public Goods, Externalities, Monopolies and Transaction Costs to name a few. These are factors that are kept in mind when policy makers pass resolutions and create safety standards. In an ideal situation none of the above concepts would exist and the market would be the most efficient version of itself, but this is not an ideal world and these concepts must be kept in mind along with ideas put forward by learned economists such as Ronald Coase, Arthur Pigou, Vilfredo Pareto, John Stuart Mill, Adam Smith and the like in order to prevent 'Market Failure'. MARKET FAILURE Market Failures occur when in a free market the allocation of goods and services is not efficient. This means that one may benefit from the use of the free market but another may face difficulties and losses. This means the situation is not "Pareto Efficient". These failures are often attributed to Public Goods, Monopolies, Asymme... ... middle of paper ... ...of Social Costs. The Journal of Law and Economics . 4. IMO; International Maritime Organisation. (2011). Retrieved October 31, 2011, from www.imo.org: http://www.imo.org/About/Conventions/ListOfConventions/Pages/International-Convention-for-the-Prevention-of-Pollution-from-Ships-(MARPOL).aspx 5. Meng, Q.-N. (1987). Land-Based Maritime Pollution. London, UK: Graham & Tortman Limited. 6. Selkou, E., & Roe, M. (2004). Globalisation, Policy and Shipping. Glos: Edward Elgar Publishing Limited. 7. Smith, A. (2009). An Inquiry into the Nature and Causes of The Wealth of Nations. Digireads.com Publishing. 8. Spiro, E. M. (1992, April). Economic Appraisal and Marine Safety. Government Economic service Working Paper No. 117; The Department of Transport . London: The Department of Transport. 9. Stigler, G. J. (1966). The Theory of Price. New York: The Macmillian Company.
First the story of the Standard Oil Company briefly describes the limits of power. When Rockefeller was trying to take over the market he formed the “South Improvement Plan. When this occurred the public grew very angry with the price of trains, so nobody went on the railroads and Rockefeller eventually got the bill, until prices changed. This is an example of how the consumers, make the company run and when nobody wants to buy your product the individual must adjust. Another example would be when the Standard Oil Company was primarily the only oil company and was forced to split into thirty nine different independent companies. This shows that one business cannot control the entire market and interventions will need to be done accordingly so that a company does not have all the power.
Market failure in a free market is defined as a condition where the allocation of goods is inefficiently done, resulting in an over allocation or under allocation of its resources. Market failures occur due to the presence of externalities.
Academic Consortium on International Trade (2000) Letter to Presidents of Universities and Colleges. Available at: http://www.spp.umich.edu/rsie/acit/ [Accessed 1 April 2014]
the output of a market reduces that output eg the punishment of criminals is a
The current issues that have been created by the market have trapped our political system in a never-ending cycle that has no solution but remains salient. There is constant argument as to the right way to handle the market, the appropriate regulatory measures, and what steps should be taken to protect those that fail to be competitive in the market. As the ideological spectrum splits on the issue and refuses to come to a meaningful compromise, it gets trapped in the policy cycle and in turn traps the cycle. Other issues fail to be handled as officials drag the market into every issue area and forum as a tool to direct and control the discussion. Charles Lindblom sees this as an issue that any society that allows the market to control government will face from the outset of his work.
As sea ice begins to melt, opportunity in sea transportation strikes as an interesting topic for the Canadian economy. Wintertime shipping has proven to be difficult in the Canadian arctic, due to heavier and thicker ice (Fergal & Prowse, 2007). Summertime has always been a preferable season for sea transportation partially due to the softened ice, and the amount of daylight produced, compared to wintertime darkness (Ferg...
The two opportunities were the social culture, and technological as he cruise line because of the down economy in the US they turn to Europe for the 2009 year in which they gain market share, and actually help the company turn a profit that year as the company shift the marketing to the European culture.
Container shipping industry is kind of international trade and destined restricted by los of regulation, such as ocean environment law, nation’s imports & exports law.
Grouchier, C & Walton, L. 2013. The maritime world: The Atlantic, Pacific and Indian Ocean World. Vol 2. London & New York.
In addition to these prerequisites, the perfect market required perfect consumer and supplier information, no rent seeking behaviour and no moral hazard existed. If these conditions were not met, market mechanisms would fail to produce the efficient allocation of resources.
In analysis of market failure, a distinction should be drawn between partial and complete market failures. While the later implies a functional market with ineffective function the former describes a complete non-functional market with inability to supply the market with required goods o...
At one point in the last year there were three ships in Tauranga’s harbour, the were the Voyager of the Seas which held 3000 people, the Seven Seas Mariner with 700 people on board and Seaborne Odyssey with 462. These three ships were investigated by the international network Friends of the Earth, they found out that all three failed the environmental assessment set by them. Royal Caribbean international had A 's for sewage and water quality, but F for air pollution. The same goes for The Seaborne Odyssey but Regent Seven Seas Cruises is the worst with a C+ for sewage, A for water Quality and again F for air pollution. The F means that they failed to co-operate with Friends of the Earth processes. Having all three cruises in Tauranga running for a day or two would have had bad impacts in Tauranga’s clean air, the average cruise ship realises more sulphur dioxide than 13 million cars. To fix this problem, Friends of the Earth are influencing people to choose their cruise after looking at the environmental effects right now Carnival cruises has the best environmental rating. To limit air pollution at New Zealand ports, more cruises opt to use off shore power while
Market failure has become an increasingly important topic for students. In simple terms, market failure occurs when markets do not bring about economic efficiency. There is a clear economic case for government intervention in markets where some form of market failure is taking place. Government can justify this by saying that intervention is in the public interest.
Illegal, unregulated and unreported fishing, or pirate fishing, is a huge threat to the marine environment, it's bio diversity in food development is dependent on it. Losses due to pirate fishing are estimated to be between 10-23.5 billion U.S. dollars per year. Representing 11-26 million tons of fish. West African waters are estimated to have the highest levels of pirate fishing in the world. Fish is a crucial source of protein for millions of people. Fishing is the major coastal employment along the coast's. During a dramatic two year investigation, the Environmental Justice Foundation (EJF) has documented mass amounts of pirate fishing on the West Coast of Africa. Pirate fishermen are literally out of control. They are fishing in protected areas, destroying local fishermens nets and sabotaging them, hiding their names, and shipping their catch illegally at sea. They evade arrest, attack local fishermen, and abusing their own crews. The catches of these pirates have been entering the EU. the worlds largest import market for seafood. This is despite a new EU regulation. The regulation requires all fish imported into Europe to be accompanied by a catch certificate that asks for name, address, validating authority, fishing vessel name, license, and homeport. This is all declares that the catches have been declared legal.y 90% of the vessels documented by EJF fishing illegally are bottom trawlers. Bottom trawlers are are vessels that drag heavy nets across the sea bed catching all marine life in their path. Up to 75% of call the catches made on these vessels are dumped back into the sea, dead or dying. Fish is the principal source of protein for 2.9 billion people. But the United Nations recognizes 80% of the world's fisheries are e...
The greatest environmental concerns associated with shipping are those relating to oil spills from accidents, equipment malfunctions or operational decisions such as dumping of bilges. However, there are other operational activities, such as loading and unloading that can have environmental and other ecological impacts. While compared to air and ground transport, shipping has received least attention from environmental impact of view, apart from obvious oil spills. For example shipping, produces less CO2 emissions per ton/km than any other transport modes do.