IDEAS home Printed from https://ideas.repec.org/a/eee/retrec/v94y2022ics0739885922000014.html
   My bibliography  Save this article

Inter-port price competition in a multi-port gateway region

Author

Listed:
  • Dong, Gang
  • Huang, Rongbing

Abstract

The purpose of this paper is to study the inter-port pricing strategy in a Multi-Port Gateway Region (MPGR) under the background of deregulating port competitive service charges. We apply a two-stage game to explore the pricing strategies adopted by the container ports in an MPGR. The resulting price matching strategy is the unique subgame perfect Nash Equilibrium of the two-stage game even though the container ports in an MPGR have different variable costs. A numerical simulation is performed on Ningbo-Zhoushan and Shanghai Ports in Yangtze River Delta Region to demonstrate the results.

Suggested Citation

  • Dong, Gang & Huang, Rongbing, 2022. "Inter-port price competition in a multi-port gateway region," Research in Transportation Economics, Elsevier, vol. 94(C).
    • Handle: RePEc:eee:retrec:v:94:y:2022:i:c:s0739885922000014
    DOI: 10.1016/j.retrec.2022.101178
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0739885922000014
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.retrec.2022.101178?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Álvarez-SanJaime, Óscar & Cantos-Sánchez, Pedro & Moner-Colonques, Rafael & Sempere-Monerris, José J., 2015. "The impact on port competition of the integration of port and inland transport services," Transportation Research Part B: Methodological, Elsevier, vol. 80(C), pages 291-302.
    2. Yang, Jinglei & Luo, Meifeng & Ji, Abing, 2016. "Analyzing the spatial–temporal evolution of a gateway’s hinterland: A case study of Shanghai, China," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 95(C), pages 355-367.
    3. Hou, Quan & Li, Si-Ming, 2011. "Transport infrastructure development and changing spatial accessibility in the Greater Pearl River Delta, China, 1990–2020," Journal of Transport Geography, Elsevier, vol. 19(6), pages 1350-1360.
    4. Aaron S. Edlin & Eric R. Emch, 1999. "The Welfare Losses From Price‐Matching PolicIes," Journal of Industrial Economics, Wiley Blackwell, vol. 47(2), pages 145-167, June.
    5. Zheng, Shiyuan & Negenborn, Rudy R., 2014. "Centralization or decentralization: A comparative analysis of port regulation modes," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 69(C), pages 21-40.
    6. Wan, Yulai & Basso, Leonardo J. & Zhang, Anming, 2016. "Strategic investments in accessibility under port competition and inter-regional coordination," Transportation Research Part B: Methodological, Elsevier, vol. 93(PA), pages 102-125.
    7. Song, Zhuzhu & Tang, Wansheng & Zhao, Ruiqing, 2018. "Cooperation mode for a liner company with heterogeneous ports: Business cooperation vs. port investment," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 118(C), pages 513-533.
    8. Edlin, Aaron S. & Emch, Eric R., 1999. "The Welfare Losses from Price-Matching Policies," Berkeley Olin Program in Law & Economics, Working Paper Series qt43b7w47c, Berkeley Olin Program in Law & Economics.
    9. Wang, Kun & Zhang, Anming, 2018. "Climate change, natural disasters and adaptation investments: Inter- and intra-port competition and cooperation," Transportation Research Part B: Methodological, Elsevier, vol. 117(PA), pages 158-189.
    10. Min Ju Bae & Ek Peng Chew & Loo Hay Lee & Anming Zhang, 2013. "Container transshipment and port competition," Maritime Policy & Management, Taylor & Francis Journals, vol. 40(5), pages 479-494, September.
    11. Ishii, Masahiro & Lee, Paul Tae-Woo & Tezuka, Koichiro & Chang, Young-Tae, 2013. "A game theoretical analysis of port competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 49(1), pages 92-106.
    12. Christopher M. Anderson & Yong-An Park & Young-Tae Chang & Chang-Ho Yang & Tae-Woo Lee & Meifeng Luo, 2008. "A game-theoretic analysis of competition among container port hubs: the case of Busan and Shanghai 1," Maritime Policy & Management, Taylor & Francis Journals, vol. 35(1), pages 5-26, February.
    13. Dong, Gang & Huang, Rongbing & Ng, Peggy, 2016. "Tacit collusion between two terminals of a port," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 93(C), pages 199-211.
    14. H E Haralambides, 2002. "Competition, Excess Capacity, and the Pricing of Port Infrastructure," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 4(4), pages 323-347, December.
    15. Kaselimi, Evangelia N. & Notteboom, Theo E. & Pallis, Athanasios A. & Farrell, Sheila, 2011. "Minimum Efficient Scale (MES) and preferred scale of container terminals," Research in Transportation Economics, Elsevier, vol. 32(1), pages 71-80.
    16. Weifen Zhuang & Meifeng Luo & Xiaowen Fu, 2014. "A game theory analysis of port specialization-implications to the Chinese port industry," Maritime Policy & Management, Taylor & Francis Journals, vol. 41(3), pages 268-287, May.
    17. Bruno De Borger & Stef Proost & Kurt Van Dender, 2008. "Private Port Pricing and Public Investment in Port and Hinterland Capacity," Journal of Transport Economics and Policy, University of Bath, vol. 42(3), pages 527-561, September.
    18. Rodrigue, Jean-Paul & Notteboom, Theo, 2010. "Foreland-based regionalization: Integrating intermediate hubs with port hinterlands," Research in Transportation Economics, Elsevier, vol. 27(1), pages 19-29.
    19. Song, Dong-Ping & Lyons, Andrew & Li, Dong & Sharifi, Hossein, 2016. "Modeling port competition from a transport chain perspective," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 87(C), pages 75-96.
    20. Xin Tian & Liming Liu & Shouyang Wang, 2015. "Evolving competition between Hong Kong and Shenzhen ports," Maritime Policy & Management, Taylor & Francis Journals, vol. 42(8), pages 729-745, November.
    21. Tan, Zhijia & Meng, Qiang & Wang, Fan & Kuang, Hai-bo, 2018. "Strategic integration of the inland port and shipping service for the ocean carrier," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 110(C), pages 90-109.
    22. Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
    23. Lee, Chung-Yee & Song, Dong-Ping, 2017. "Ocean container transport in global supply chains: Overview and research opportunities," Transportation Research Part B: Methodological, Elsevier, vol. 95(C), pages 442-474.
    24. Liu, Liming & Wang, Kelly Yujie & Yip, Tsz Leung, 2013. "Development of a container port system in Pearl River Delta: path to multi-gateway ports," Journal of Transport Geography, Elsevier, vol. 28(C), pages 30-38.
    25. Sheng, Dian & Li, Zhi-Chun & Fu, Xiaowen & Gillen, David, 2017. "Modeling the effects of unilateral and uniform emission regulations under shipping company and port competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 101(C), pages 99-114.
    26. Zhang, Qi & Wang, Wenyuan & Peng, Yun & Zhang, Junyi & Guo, Zijian, 2018. "A game-theoretical model of port competition on intermodal network and pricing strategy," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 114(C), pages 19-39.
    27. Seo, Young-Joon & Park, Jin Suk, 2016. "The estimation of minimum efficient scale of the port industry," Transport Policy, Elsevier, vol. 49(C), pages 168-175.
    28. Janssen, Maarten C.W. & Parakhonyak, Alexei, 2013. "Price matching guarantees and consumer search," International Journal of Industrial Organization, Elsevier, vol. 31(1), pages 1-11.
    29. repec:bla:jindec:v:47:y:1999:i:2:p:145-67 is not listed on IDEAS
    30. Notteboom, Theo E., 2010. "Concentration and the formation of multi-port gateway regions in the European container port system: an update," Journal of Transport Geography, Elsevier, vol. 18(4), pages 567-583.
    31. Zhang, Z John, 1995. "Price-Matching Policy and the Principle of Minimum Differentiation," Journal of Industrial Economics, Wiley Blackwell, vol. 43(3), pages 287-299, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tan, Bing Qing & Xu, Su Xiu & Thürer, Matthias & Kang, Kai & Zhao, Zhiheng & Li, Ming, 2024. "Booking versus search-based parking strategy: A game-theoretic methodology," Research in Transportation Economics, Elsevier, vol. 104(C).
    2. Lu, Bo & Fan, Lijie & Wang, Huipo & Moon, Ilkyeong, 2024. "Price-cutting or incentive? Differentiated competition between regional asymmetric ports," Transport Policy, Elsevier, vol. 147(C), pages 215-231.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dong, Gang & Zheng, Shiyuan & Lee, Paul Tae-Woo, 2018. "The effects of regional port integration: The case of Ningbo-Zhoushan Port," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 120(C), pages 1-15.
    2. Gang Dong & Dandan Zhong, 2019. "Tacit Collusion of Pricing Strategy Game between Regional Ports: The Case of Yangtze River Economic Belt," Sustainability, MDPI, vol. 11(2), pages 1-17, January.
    3. Dong, Gang & Huang, Rongbing & Ng, Peggy, 2016. "Tacit collusion between two terminals of a port," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 93(C), pages 199-211.
    4. Wang, Junjin & Liu, Jiaguo & Wang, Fan & Yue, Xiaohang, 2021. "Blockchain technology for port logistics capability: Exclusive or sharing," Transportation Research Part B: Methodological, Elsevier, vol. 149(C), pages 347-392.
    5. Sheng, Dian & Li, Zhi-Chun & Fu, Xiaowen & Gillen, David, 2017. "Modeling the effects of unilateral and uniform emission regulations under shipping company and port competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 101(C), pages 99-114.
    6. (Kevin) Park, Hyosoo & Chang, Young-Tae & Zou, Bo, 2018. "Emission control under private port operator duopoly," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 114(C), pages 40-65.
    7. Yang, Zhongzhen & Guo, Liquan & Lian, Feng, 2019. "Port integration in a region with multiport gateways in the context of industrial transformation and upgrading of the port," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 122(C), pages 231-246.
    8. Song, Zhuzhu & Tang, Wansheng & Zhao, Ruiqing, 2018. "Cooperation mode for a liner company with heterogeneous ports: Business cooperation vs. port investment," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 118(C), pages 513-533.
    9. Guo, Liquan & Yang, Dong & Yang, Zhongzhen, 2018. "Port integration method in multi-port regions (MPRs) based on the maximal social welfare of the external transport system," Transportation Research Part A: Policy and Practice, Elsevier, vol. 110(C), pages 243-257.
    10. Wei Wang & Chengjin Wang & Fengjun Jin, 2017. "The Functional Structure Convergence of China’s Coastal Ports," Sustainability, MDPI, vol. 9(12), pages 1-15, November.
    11. Zheng, Shiyuan & Wang, Kun & Fu, Xiaowen & Zhang, Anming & Ge, Ying-En, 2022. "The effects of information publicity and government subsidy on port climate change adaptation: Strategy and social welfare analysis," Transportation Research Part B: Methodological, Elsevier, vol. 166(C), pages 284-312.
    12. Lu, Bo & Fan, Lijie & Wang, Huipo & Moon, Ilkyeong, 2024. "Price-cutting or incentive? Differentiated competition between regional asymmetric ports," Transport Policy, Elsevier, vol. 147(C), pages 215-231.
    13. Dong, Gang & Ishii, Masahiro & Zheng, Shiyuan & Tezuka, Koichiro & Lee, Paul Tae-Woo, 2024. "Port capacity-sharing decisions in the post-COVID-19 pandemic era," Transport Policy, Elsevier, vol. 147(C), pages 22-31.
    14. Zheng, Shiyuan & Jiang, Changmin & Fu, Xiaowen, 2021. "Investment competition on dedicated terminals under demand ambiguity," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 150(C).
    15. Yang, Jinglei & Luo, Meifeng & Ji, Abing, 2016. "Analyzing the spatial–temporal evolution of a gateway’s hinterland: A case study of Shanghai, China," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 95(C), pages 355-367.
    16. Zheng, Shiyuan & Luo, Meifeng, 2021. "Competition or cooperation? Ports’ strategies and welfare analysis facing shipping alliances," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 153(C).
    17. Song, Dong-Ping & Lyons, Andrew & Li, Dong & Sharifi, Hossein, 2016. "Modeling port competition from a transport chain perspective," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 87(C), pages 75-96.
    18. Zhao, Ruijia & Xie, Xinlian & Li, Xinyang & Li, Guodong, 2020. "Game-theoretical models of competition analysis and pricing strategy for two modes for repairing damaged marine structures at sea," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 142(C).
    19. Luo, Meifeng & Chen, Fuying & Zhang, Jiantong, 2022. "Relationships among port competition, cooperation and competitiveness: A literature review," Transport Policy, Elsevier, vol. 118(C), pages 1-9.
    20. Liu, Jiaguo & Wang, Junjin, 2019. "Carrier alliance incentive analysis and coordination in a maritime transport chain based on service competition," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 128(C), pages 333-355.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:retrec:v:94:y:2022:i:c:s0739885922000014. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/620614/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.