ISCAP Proceedings: Abstract Presentation
An Empirical Analysis of the Impact of Logistics Performance on Export Volume: Evidence from Selected Countries
Chen Tao
Towson University
Stella Tomasi
Towson University
Abstract
The Logistics Performance Index (LPI) is an indicator developed by the World Bank that provides the logistics performance of countries. LPI can help identify issues in trade and logistics, which can support a country’s ability to make improvements to their trade performance (Mesic et al., 2022). The index provides information about the state of customs regulations, logistics costs, and land, sea, and air transport infrastructure in various countries. The goal is to capture the key aspects of logistics performance that can determine the ability of shippers and consignees to arrange timely, reliable, and competitive transportation of goods (Ben & Tanaporn, 2022). An increase in the various variables of the LPI can have a significant impact on a country’s trade and logistics performance (Marti & Puertas et al., 2014). However, many countries are not able to reach the advancement in logistics that are seen in developed economies (Hoekman et al., 2010).
There is a logistics performance gap between developing and developed countries, suggesting that enterprises in developing nations are less competitive in international trade than those in developed countries. Therefore, in this study , we explore how LPI affects export trade for 36 countries within the G20 Summit from 2007 to 2018. The international LPI comprises five key dimensions: Customs (C), Infrastructure (I), International Shipment (IS), Logistics Quality and Competence (LQC), and Timeliness (T). Using international trade theory and previous empirical research, this study analyses a model previously developed by Huynh and Hong (2022) to assess the impact of international logistics performance on export flows using data from countries in the G20 summit. The specific model is as follows:
??????=??0+??1??????????+??2??????+??3??????+??4??????????+??5??????????+??????
Where ?????? represents the export volume of country i in year t, ?????????? is the Logistics Performance Index of country i in year t, ?????? is the population growth rate of country i in year t, ?????? is the import volume of country i in year t, ?????????? denotes the Gross Domestic Product of country i in year t, ??????????represents foreign direct investment of country i in year t, ?????? is the error term, and \alpha, ??1,??2,??3,??4,??5 are the regression coefficients. The dependent variable is the export volume (X), measured as a percentage of GDP. The independent variable is the overall Logistics Performance Index (LPI), The control variables are population, GDP import, GDP growth rate, and net inflows of foreign direct investments. Current results indicate that LPI, import flows, and GDP growth all have a significant impact on the changes in export flows.This research can enhance our understanding of the relationship between export volume and the LPI variables among different countries. It can therefore serve as a valuable reference for economic analysis and strategic decision-making at the national level.