Shipbuilding: The Neglected Industry among Those of Shipping, Maritime & Marine: The Case-Studies of UK, Japan & S Korea ()
ABSTRACT
Adam Smith observed that UK endowed by different “natural gifts” vis-à-vis
other nations, and so he proposed specialization and trade. Also, the mechanization could boost the productivity of manual labor, leading to the 1st Industrial Revolution. One unintentional mistake of Smith occurred in basing
economic development only on “resource-based industries”! Mercantilists
discovered that UK’s “wealth” can be derived from a positive Balance of Trade! British also realized, using their Navy that a number of colonies would promote their trade, and UK’s wealth, and
formed the 1st sea Cartel (1875). This led British to obtain the
highest share in global seaborne trade, since 1890, but also to be first in the global shipbuilding. This advantage lost by UK in the 1960s, and also lost by Europe in
1978, and obtained by Japan, S Korea and China! Piracy
determined nations’ territorial sea! The liberated colonies voted the “Law of
the Sea”, in 1982, creating the “Marine Economies”! Arabs in 1975, and others
in 1979, and Russia in 2022, created a great challenge for economists of how to
achieve “sustainability”. The cyclicality of shipbuilding, since 1948, is shown as well the behavior
of ship-owners, during 1975-1987 depressions. Interesting were the results of a
survey carried-out among 50 Greek shipping companies of how to select a
shipyard. We created 3 diagrammatic & mathematical models to analyze the
way shipbuilding prices are determined, and the role of fixed cost, including
the case of a price war. Finally, we elaborated the issues of why to
establish an ephemeral shipbuilding industry at all, and why to build
ships for foreigners…