“The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger” by Marc Levinson (books that matter to me)

“The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger” explains the global economy and how it works all by going thru the history and the numbers behind the development and more or less universal use of the shipping container (the “box”). Altho there are a few chapters crammed with a surplus of details and data, the basic story is riveting.

Before the shipping container, whether or not a particular item was a “good” price depends largely on manufacturing or production costs as transportation costs were often prohibitive. Most consumers bought goods from makers within their countries unless the manufacturing costs were so inexpensive that the sky high cost of getting the goods elsewhere was still an economic viable choice. All of this is a massive overgeneralization but not totally untrue.

With standardization of shipping containers across the globe, the need for labor in transport has dropped to virtually nothing. Often, the containers are packed at the production site and transported thereafter without being opened or handled. Even the huge container ships themselves require very small crews. The result is a reduction of (on average) over 90% in shipping costs. Effectively, shipping costs don’t matter any more.

That means that an extremely minor differential in labor costs of production matter when determining where to source your goods. Because containers are dispersed easily from only a few large ports, it’s trivial for a large corporation to switch suppliers at a moment’s notice. That’s changed the power structure of making goods and moved the primary power to the entities mostly able to make use of minor differences — the big guys.

The book has been revised since its initial release 2006 to note further proof of the revolutionary (rather than evolutionary) effect of universally common shipping containers. If you’re interested in the global economy and how it works, read this.

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