The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger - Second Edition with a new chapter by the author

The improvement in logistics shows up statistically in reduced inventory levels. Inventories are a cost: whoever owns them has had to pay for them but has yet to receive money from selling them. Better, more reliable transport has permitted companies to obtain goods closer to the time they need them, instead of weeks or months in advance, tying up

In a place where replacement parts could not simply be ordered from a nearby distributor, the chance that something would go wrong, blowing budgets and cost calculations, was very high. McLean was running a commercial operation in a war zone, and betting that he could control costs well enough to make a profit from his fixed-price bid.27 The gamble

Behind this frenzied expansion of long-neglected ports was the emergence of an entirely new line of thought about economic growth. Manufacturing was almost universally regarded as the bedrock of a healthy local economy in the 1960s, and much of the value of a port, aside from jobs on the docks, was that transportation-conscious manufacturers would

When transport costs are high, manufacturers’ main concern is to locate near their customers, even if this requires undesirably small plants or high operating costs. As transportation costs decline relative to other costs, manufacturers can relocate first domestically, and then internationally, to reduce other costs, which come to loom larger. Glob

On January 9, 1959, the world’s first purpose-built container crane went into operation, loading one 40,000-pound box every three minutes. At that rate, the Alameda terminal could handle 400 tons per hour, more than 40 times the average productivity of a longshore gang using shipboard winches. Similar cranes were installed in Los Angeles and Honolu

On the other hand, many dockers cherished the fact that their work was inherently casual. If a longshoreman chose not to work on any particular day, if he decided to go fishing rather than shaping, he was entirely within his rights.13 Thanks to these particularities, one sociologist observed, “More than in any other industry in a big city, it appea

These new ports, by and large, were privately managed, and in some cases privately financed. Their creation was a deliberate response to the economics of container shipping, in which keeping the ship moving is what matters most. Only the biggest ports are worth a time-consuming stop: in 2014, 46 percent of world container shipments moved through ju

“Unless a container terminal is available in Hong Kong to serve these ships the trading position of the Colony will be affected detrimentally.” And no government anywhere was more aggressive in preparing for the container age than Singapore’s.

Demand, robust though it was, could not possibly keep up with this explosion of supply. The result was a new and painful experience for the shipping industry: a rate war.