Measuring Market Accessibility of Insular Areas based on Network Distance and Shipment Cost
Abstract
In this paper, we calculate the two-sided (consumer and producer) market accessibility of the Greek islands, based on different measures of transport cost, namely, the actual network distance and the freight shipment cost from/to mainland regions and between them. For this purpose, we employ a unique micro-dataset of 1,026,469 shipments for the year 2021 originated from the platform of Islands’ Transport Equivalent for firms. The shipment cost refers to the receipts of payments made by firms for outsourcing transport services to companies with public-use truck vehicles. The findings show the importance of the population size, geographical proximity to large markets and network connectivity, and underscore the severe imbalances among consumers’ (importers’) and producers’ (exporters’) accessibility to and from the Greek islands. Moreover, the use of shipment cost significantly alters the accessibility hierarchy and trade imbalance inequalities among islands, as it incorporates inherent characteristics of the logistics and product markets. Relevant policy implications are made to support the design of more effective island policies aimed at supporting the competitiveness of local businesses, the living standards of inhabitants and the territorial cohesion of the country.