Pricing and competition in a shipping market with waste shipments and empty container repositioning

Rongying Chen, Jing-Xin Dong and Chung-Yee Lee

Transportation Research Part B: Methodological, 2016, vol. 85, issue C, 32-55

Abstract: In this paper, we study a shipping market with carriers providing services between two locations. Shipments are classified into two categories: goods and waste. Trade imbalance allows low-valued waste to be shipped at bargain rates. If imbalance persists, empty containers must be repositioned from a surplus location to a shortage location. Carriers decide prices, which will affect the demand. We build a monopoly and a duopoly model to find the optimal pricing strategy for carriers. We also analyze how the profit of a carrier is affected by price sensitivity, cost structure and competition intensity.

Keywords: Waste shipment; Empty container repositioning; Price competition (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (22)

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DOI: 10.1016/j.trb.2015.12.012

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