Cooperation mode for a liner company with heterogeneous ports: Business cooperation vs. port investment

Zhuzhu Song, Wansheng Tang and Ruiqing Zhao

Transportation Research Part E: Logistics and Transportation Review, 2018, vol. 118, issue C, 513-533

Abstract: This paper considers a liner company that docks at one of two heterogeneous ports and selects either business cooperation or port investment. The results demonstrate that port investment always makes the port better off but may be detrimental for the liner company. Interestingly, when the liner company reaches a port investment agreement with one port, the other port also benefits. With port investment, the liner company and the two ports will raise the prices they charge to shippers, which means that the Pareto gains of the supply chain may be realized at the cost of extracting more surplus from shippers.

Keywords: Marine supply chain; Cooperation mode; Port investment; Two-stage game; Port competition (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (14)

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DOI: 10.1016/j.tre.2018.09.004

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