Containerization did not reduce ocean transportation costs until well after its adoption. Using a previously unused measures of U.S. import freight costs, I show that freight rates did not decline when containers were adopted. Trade in containerizable goods grew since Kennedy Round tariff declines were concentrated in those goods. Data from major U.S. ports show that labor costs did not fall much despite enormous labor productivity gains. Market power in ports meant that dramatic productivity gains did not translate into dramatically lower freight rates. The long delay helps explain the apparent increase in the trade cost-import elasticity in the 1980s.

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