Shipping business unwrapped: illusion, bias and fallacy in the shipping business
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Shipping business unwrapped: illusion, bias and fallacy in the shipping business Okan Duru 2018 (Routledge Publishing), pp. 130. ISBN: 9781138292468 Satya Sahoo 1 # World Maritime University 2020
At my first exposure to the subject of derivatives and risk management as a part of master’s programme, I had asked a subject professor that having used a series of derivative tools could be regarded as a sort of gambling. I was, however, convinced at the end of the lecture that derivatives are the exact opposite to gamble as they are used to secure uncertain future cash flows. This book opens with the same question that I had at the beginning of the derivatives lectures; that is, “are derivatives similar to a gamble?”, for which I had decided to review the book. This is an interesting book covering a behavioural aspect of practitioners in the shipping industry, providing an overview of the shipping markets, information transmission, shipping crisis, practices and managerial roles with big data and artificial intelligence. Most importantly, the author has managed to include multiple business sections and real-world practices in the shipping industry by offering a holistic overview of the business practices and identifying the gaps between theories and practices. The author has a unique style of presenting complex ideas in a simple text or manner, which could at times be considered an unorthodox academic writing, but easy to understand and relate to the practice for non-academic readers. This book consists of twenty-three chapters. After the introduction, the chapter one to three present an overview of the shipping freight and asset markets and the fundamental driving factors of the shipping industry as demand and supply. The chapter four to seven discuss the so-called secretive nature of the shipping industry, asymmetric information, and how emotions of the shipping practitioners supersede rationale behaviour of the shipping industry. The following three chapters (8–10) present the unique and risky characteristics of the shipping industry causing shipping crises. Although it is claimed that each crisis is unique, the author attempts to highlight the commonality among those crises and how shipping companies react after the 2008
* Satya Sahoo [email protected]
1
Shipping and Port Management, World Maritime University, Malmö, Sweden
Sahoo S.
financial crisis, moving towards alliances. The chapter eleven to sixteen describe the motivation, biasness and the difference between know-how and know-why for top managements in shipping companies. The same chapters also indicate that the decisions taken by senior management may sometimes seek for a short-term benefit in order to satisfy investors, not for the best interest of the company in a long-run. Furthermore, there is a trend in the shipping industry to form alliances since the size matters and the larger shipping companies are treated as a too-large-to-fail practice. Even though seafarers can be a vital asset for the shipping companies, the chapter seventeen indicates the growin
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