Short sea shipping as intermodal competitor: a theoretical analysis of European transport policies

Abstract

Despite the European Union (EU) efforts promoting policies that encourage short sea shipping (SSS) based on its advantages in terms of intermodality and environment, this mode has not yet reached a significant market share compared to land transport. In this paper, we establish a thesis that suggests that funding programs (such as Marco Polo I and II) have not properly offered the right incentives to promote SSS, and aspects such as the key role of port infrastructure and its characteristics, have not been taken into consideration. In a departure from traditional transport cost models, to prove our thesis, we use a theoretical intermodal competition model to compare alternative modes-road transport vs. SSS. We reach the conclusion that the EU needs to focus on ports and transport system efficiency as a whole in order to compete effectively in the freight transport market.