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Int. J. Financial Stud. 2018, 6(1), 11; doi:10.3390/ijfs6010011

A Critical Review of the Literature on Firm-Level Theories on Ship Investment

Department of Maritime and Logistics Management, Australian Maritime College, University of Tasmania, Newnham 7248, Australia
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Received: 28 November 2017 / Revised: 17 January 2018 / Accepted: 17 January 2018 / Published: 19 January 2018
(This article belongs to the Special Issue Alliances, Mergers and Acquisitions in the Shipping Sector)
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Abstract

The maritime industry is one of those rare industries that are both highly international integrated to international trade and also highly capital intensive dependent on substantial investment amount. In the literature, ship investments have not been widely examined through the firm-level investment theories to explore the link between investment level and asset price valuation. The general trend in the literature of ship investments is to analyse the relationship among the shipping markets (newbuilding, second-hand, freight rate and scrap) and their impact on asset price valuation, the timing of investments and market entry and exit conditions. In this paper, we extensively reviewed the literature of firm-level investment theories and ship investments. We showed that the application of firm-level investment theories to the ship investments is confined to the basic investment valuation models, such as Net Present Value and Real Option Analysis. Ship investments need to be examined by firm-level investment theories to define firm/industry value maximization level within the approach of the solid investment theories. View Full-Text
Keywords: investment theories; microeconomics; ship investments; maritime industry investment theories; microeconomics; ship investments; maritime industry
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).

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MDPI and ACS Style

Celik Girgin, S.; Karlis, T.; Nguyen, H.-O. A Critical Review of the Literature on Firm-Level Theories on Ship Investment. Int. J. Financial Stud. 2018, 6, 11.

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Int. J. Financial Stud. EISSN 2227-7072 Published by MDPI AG, Basel, Switzerland RSS E-Mail Table of Contents Alert
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