Profit Sharing and the Stability of Shipping Alliances Based on Game Theory

Zhaojing Wang, Hao Hu, Qingcheng Zeng and Xiaobing Li

Journal of Transport Economics and Policy, 2016, vol. 50, issue 3, 245--261

Abstract: The liner shipping industry has been characterised by a greater concentration after the advent of new shipping alliance policies: Ocean Three and 2M. The Modified Shapley model and the core theory are proposed to investigate the profit share and the stable operation of alliances. The results have revealed that: (i) a more reasonable profit distribution mechanism exists that considers risk-taking, market competitiveness and investment; (ii) the stable distribution intervals of dominant and non-dominant members are deduced to ensure their loyalty to alliances without re-structuring. This fills the gaps in the research on profit sharing by alliance members with different capacities.

Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:tpe:jtecpo:2016:50:3:245--261

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