Vessel Port Dues: An Influence from Path Dependency rather than Geography of Ports

Abstract

Port dues have a limited impact on the door-to-door international decision making process. They are, however, a major source of revenue for port authorities. Their objective is to balance budgets (recovery pricing, marginal cost pricing, external cost pricing, etc.) and enable financing of infrastructure. As such, while they may not have a direct impact on the attractiveness and competition of ports, their indirect impact is unquestionable. This study investigates vessel port dues, which follow diverse formulas of calculation that complicate comparisons. Therefore, we classify vessel port dues into two categories: Gross Tonnage based, and Cubic Meter based. These categories are essential insofar as they correspond to two geographical realities of ports: bay ports for the former, and channel ports for the latter. An empirical study on ports located in Western Mediterranean Sea countries illustrates the relevance of these two models. It also exposes deviation in the application of these models implied by path dependency. Such deviation has an influence on the pricing system and fairness of invoicing. This work demonstrates the necessity for improving port pricing in several ports on both banks of the Western Mediterranean Sea, as well as the necessity for fairer application of port dues.