This paper empirically examines the effects of domestic transportation costs on product prices in an archipelagic country, namely, Indonesia. Specifically, we investigate the province‐level price of televisions. Our analysis reveals that maritime transportation is more expensive than land transportation. For example, a 1% increase in distance in maritime and land transportation increases the price of televisions by 0.08% and 0.02%, respectively. This result implies that the geographical concentration or agglomeration of industries is much costlier in archipelagic countries. In other words, enjoying agglomeration effects is more difficult for archipelagic countries compared with countries on a continent; thus, archipelagic countries have a topographical disadvantage.

中文翻译：

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群岛的运输成本：来自印度尼西亚的证据

本文从经验上考察了国内运输成本对群岛国家印度尼西亚的产品价格的影响。具体来说，我们调查省级电视价格。我们的分析表明，海上运输比陆上运输更昂贵。例如，海上和陆地运输距离增加1％，电视价格分别增加0.08％和0.02％。这一结果表明，在群岛国家，工业的地理集中或集聚成本要高得多。换句话说，与大洲国家相比，群岛国家要享受集聚效应要困难得多。因此，群岛国家在地形上处于劣势。