A MODIFIED DUOPOLY GAME MODEL IN BULK COMMODITY TRANSPORTATION MARKETS

Zhiyong Yang () and A. N. Perakis
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Zhiyong Yang: Exmar Offshore Company, 11511 Katy Freeway Ste 200, Houston, TX 77069, USA
A. N. Perakis: Department of Naval Architecture and Marine Engineering, University of Michigan, Ann Arbor, USA

International Game Theory Review (IGTR), 2007, vol. 09, issue 02, 269-284

Abstract: In this paper, we try to analyze the interactions among the shippers and the carriers, including the rail and marine shipping industry, in the bulk shipping market. Our paper presents both a two-player game model, and a two-stage, three-player, game model that includes the buyer as an active player. Assuming the players have complete information, we derive an analytical solution to a two-stage, three-player game with capacity constraints. We also present a numerical algorithm to solve a two-stage, three-player game with complete information. A grain transportation scenario in the Great Lakes and St. Lawrence Seaway is used to illustrate our models. The results suggest that the two-stage, three-player game model has a better prediction capability than the duopoly game model in the bulk shipping competition problem.

Keywords: Game theory; duopoly game; a two-stage; three-player game; game with complete information; capacity constraints (search for similar items in EconPapers)
JEL-codes: B4 C0 C6 C7 D5 D7 M2 (search for similar items in EconPapers)
Date: 2007
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DOI: 10.1142/S0219198907001394

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