Shipping route choice across geographies: Coastal vs. landlocked countries

• Relationship between transportation costs, geography, infrastructure and structure of logistic systems is studied.
• Logistic networks are fragmented, as an average shipper travels longer to avoid a border.
• Port choice behaviors differ across coastal and landlocked nations.
• Landlocked countries have higher preference for proximity and transportation quality.
• Significant heterogeneity exists in preferences across shippers of various size.

This paper investigates how geography and transportation costs influence the decisions by shippers of which port of export to use. Using a large sample of disaggregated shipments originating from several countries in Europe, we show that European logistics networks exhibit a low level of international integration that affects shipping route choice. Furthermore, we find significant differences in shipping behaviors across landlocked and coastal countries, with shippers in landlocked countries avoiding long land transportation, crossing borders readily, and placing more value on transportation infrastructure. These findings have implications in designing port competitiveness strategies and economic development policies in landlocked countries.