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Reactions to The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger by Marc Levinson

The Box: How the Shipping Container Made the World Smaller and the World Economy BiggerThe Box: How the Shipping Container Made the World Smaller and the World Economy Bigger by Marc Levinson
My rating: 5 of 5 stars

You might think that the Cliffs Notes summary of The Box would be enough. Yes, the shipping container revolutionized the global economy by almost eliminating considerations of shipping cost and geographic proximity in the manufacturing supply chain. This development allowed factories to locate essentially anywhere – not just near transportation hubs – and so radically reshaped longstanding trade patterns and practices. It’s not too extreme to say that the shipping container played an oversized role in making manufactured goods widely accessible and affordable at a scale previously unattained, so increasing the standard of living of hundreds of millions of people.

But if you stopped there, you would miss the fascinating and by no means inevitable story of just how the entrepreneurs behind the container effected such powerful change. Levinson does not focus exclusively on the shipping container itself, but shows how broader trade systems and relationships were required to change the box to make its impact. His assiduous research convincingly quantifies the impact of each development, with the mountain of data only occasionally obscuring the human narrative.

The most optimistic lesson of The Box is that entrepreneurial energy can harness technology to upend even the most ossified, over-regulated, labor-dominated industries for the greater benefit of people. After WWII, the shipping industry was completely regulated, heavily unionized, and centrally controlled, including (especially) in the United States, with little mechanical interoperability. No, one, certainly not regulators or workers, was trying to innovate or otherwise improve the system. The introduction and widespread deployment of the shipping container and related inventions and trade practices upended the industry, greatly increasing trade around the world – without needing to start with central regulatory or labor reform. The case of the shipping container demonstrates that better technology can overcome entrenched regulation and obsolete work restrictions (foreshadowing how Uber and similar services are dismantling the corrupt taxi cartels.)

What’s more, container entrepreneurs didn’t just invent a new form of storage and ships to carry it, but also knit together the entire supporting infrastructure – from reworking the contract structures of the trucking industry to creating consortia to agree on standardized designs for new harbor equipment. They actually worked together, legally and productively, to revolutionize the very basis of trade – without any central regulatory push. While I don’t think self-regulation works in every case in every industry – banking and related financial services have not earned any credibility on this front – Levinson makes a persuasive case for how shipping entrepreneurs “hacked” (my term) the system for the good of all.

Of course some shipping centers refused to accommodate the standardized container (largely because labor unions were unwilling to update agreements to accommodate the new technology), and their ultimate demise caused localized economic pain – “good” jobs and trade were lost. But even more communities embraced the new system, enabling rich trade centers to grow where previously geographically impossible. The overarching testament of the The Box is that economics and trade are not a zero sum game – that reducing cost while increasing quality and reliability can radically increase overall demand for a service. That if something is easier, cheaper, and better, then more people will buy it. The size of the pie increases enough so that all participants in the system, including both the entrepreneurs who take risks to innovate and the workers who enable the trade, actually benefit from the plummeting of costs of transactions.

The Box is fundamentally data-driven. A few colorful personalities emerge, but Levinson builds the story primarily on how and where trade flowed, and the before/after effects of specific policies and technologies. While this approach of course buttresses its credibility, The Box is therefore likely to appeal those of a wonkish bent – entrepreneurs, technologists, inventors, policy-makers, and investors who want to understand the nuts of and bolts of one of the most far-reaching and beneficial innovations in history.

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