Entry in the global liner shipping industry: a population ecology study, 1996–2006

Abstract

This study examines the global population of container liners and their trade route entry patterns from 1996 to 2006. Concepts from population ecology (population density, forces of legitimacy, competition and imitation, and the liability of smallness) are applied to empirically test the probability of entry by liners into a particular trade route. The findings show that entry into trade routes follows an inverted-U shaped (∩) relationship with the number of players operating in the trade route, increases with the number of trade routes operated by a player, and has a sharper inverted-U shaped relationship for Asian and North American firms. These findings, from the first comprehensive population level study of the liner shipping industry, provide insights into the strategic decision of entry into trade routes made by liner shipping firms during an 11-year period.