International Shipping Costs Pass Through to Inflation; Evidence Using Census Import Data

International Shipping Costs Pass Through to Inflation; Evidence Using Census Import Data | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article International Shipping Costs Pass Through to Inflation; Evidence Using Census Import Data JAMES BOOHAKER This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-6087736/v1 This work is licensed under a CC BY 4.0 License Status: Published Journal Publication published 13 Aug, 2025 Read the published version in Review of World Economics → Version 1 posted 5 You are reading this latest preprint version Abstract The COVID-19 pandemic's impact on supply chains and the highest inflation since the 1980s have drawn significant attention to the link between supply chains and inflation. Recent literature has documented several channels through which increased supply chain congestion can have significant pass through effects to inflation. One of these channels is that worsening congestion leads to higher shipping costs which could be passed onto downstream producers and consumers. Research in this area often uses aggregated monthly data on sea vessel shipping costs to analyze pass-through effects, limiting insights into whether specific import cost shocks (e.g., consumer imports or imports from a single exporting country) contribute more to the observed effects and omits potential pass through effects of shipping costs using other modes of transportation (e.g. air cargo). Such analysis could offer clarity for more accurate inflation forecasts and inspire further theoretical research into the causal links between supply chain congestion, shipping costs and inflation. Using monthly Census import data from 2002 to 2024, this paper analyzes pass through effects of import costs onto import, producer and consumer inflation. Using time-series local projection methods, I demonstrate that a 1 percentage point shock in annual growth rates of shipping charges per import transaction impacts consumer inflation for about 10 months, peaking at roughly 10 basis points 6 months after the shock — aligning with existing literature. I go on to show that pass through effects to PPI are higher and occur sooner than that for consumer products. I then exploit the granularity available in the data to show that shocks to shipping costs for consumer products, semiconductors, sea vessel shipping costs and imports from China significantly pass through to general PPI and CPI inflation. inflation supply chains import costs local projection methods Full Text Cite Share Download PDF Status: Published Journal Publication published 13 Aug, 2025 Read the published version in Review of World Economics → Version 1 posted Editorial decision: Revisions needed 19 May, 2025 Reviewers agreed at journal 20 Mar, 2025 Reviewers invited by journal 18 Mar, 2025 Editor assigned by journal 24 Feb, 2025 First submitted to journal 22 Feb, 2025 You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. 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Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-6087736","acceptedTermsAndConditions":true,"allowDirectSubmit":false,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":430645513,"identity":"a492251b-2d10-4f2f-9718-5ddfe34a69ab","order_by":0,"name":"JAMES BOOHAKER","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAA3klEQVRIiWNgGAWjYBACAwYGNgaGA0BS/jGQZJCQIV4LP0NaAkgLD/FaJBtyDEAChLWYszcfe/DjjE2+wYEzn1/dqLHgYWA/fHQDPi2WPcfSDXtupFluONi7zTrnGNBhPGlpN/A67EaOmQTPh8MGBod5txnnsAG1SPCYEdQi+efDfwODYzzPjHP+EalFmufGAQPJHh7mx7ltRGgB+iVNWuZMsgG/BJsZc26fBA8bIb+AQkzyzTE7AzYJ5sefc77VyfGzHz6GVwsyYJMAk8QqBwHmD6SoHgWjYBSMgpEDAHuESBO87kuJAAAAAElFTkSuQmCC","orcid":"","institution":"Office of Management and Budget","correspondingAuthor":true,"prefix":"","firstName":"JAMES","middleName":"","lastName":"BOOHAKER","suffix":""}],"badges":[],"createdAt":"2025-02-23 01:25:48","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-6087736/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-6087736/v1","draftVersion":[],"editorialEvents":[{"content":"https://doi.org/10.1007/s10290-025-00601-8","type":"published","date":"2025-08-13T15:57:46+00:00"}],"editorialNote":"","failedWorkflow":false,"files":[{"id":89310666,"identity":"82a40e1c-1469-4e9d-8b6e-67f5f0f63e40","added_by":"auto","created_at":"2025-08-18 16:09:24","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":1931466,"visible":true,"origin":"","legend":"","description":"","filename":"censussupplychain1.pdf","url":"https://assets-eu.researchsquare.com/files/rs-6087736/v1_covered_7da3e98f-11a4-48ea-86ec-cf9f4220e94d.pdf"}],"financialInterests":"","formattedTitle":"International Shipping Costs Pass Through to Inflation; Evidence Using Census Import Data","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":false,"highlight":"","institution":"","isAcceptedByJournal":true,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":true,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"review-of-world-economics","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":false,"externalIdentity":"rowe","sideBox":"Learn more about [Review of World Economics](http://link.springer.com/journal/10290)","snPcode":"10290","submissionUrl":"https://www.editorialmanager.com/rowe/default2.aspx","title":"Review of World Economics","twitterHandle":"","acdcEnabled":true,"dfaEnabled":true,"editorialSystem":"em","reportingPortfolio":"Springer Hybrid","inReviewEnabled":true,"inReviewRevisionsEnabled":false},"keywords":"inflation, supply chains, import costs, local projection methods","lastPublishedDoi":"10.21203/rs.3.rs-6087736/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-6087736/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"The COVID-19 pandemic's impact on supply chains and the highest inflation since the 1980s have drawn significant attention to the link between supply chains and inflation. 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