IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v12y2020i16p6595-d399110.html
   My bibliography  Save this article

Global Emission Taxes and Port Privatization Policies under International Competition

Author

Listed:
  • Feng Pian

    (Department of Economics and Trade, Dalian Maritime University, 1 Linghai Road, Dalian 116026, China)

  • Lili Xu

    (Department of Economics and Trade, Dalian Maritime University, 1 Linghai Road, Dalian 116026, China)

  • Yuyan Chen

    (Department of Economics and Trade, Dalian Maritime University, 1 Linghai Road, Dalian 116026, China)

  • Sang-Ho Lee

    (Department of Economics, Chonnam National University, 77 Yongbong-Ro, Bukgu, Gwangju 61186, Korea)

Abstract

This study considers two asymmetric ports under international competition in which each country has a hub port and a private manufacturer and investigates strategic interactions between port privatization and emission tax policies. We emphasize the key role of the relative market size between the two countries and show that in a privatization choice game, port privatization is a dominant strategy in a larger country, but it will be chosen by a smaller country only if its relative market size is not so small. We also show that the coordination of global emission taxes before privatization choices can induce the equilibrium of the game to be globally optimal when the emission tax is relatively high. This finding provides an important policy implication on the climate change that coordinated global environmental policy is imperatively required in the port privatization policy.

Suggested Citation

  • Feng Pian & Lili Xu & Yuyan Chen & Sang-Ho Lee, 2020. "Global Emission Taxes and Port Privatization Policies under International Competition," Sustainability, MDPI, vol. 12(16), pages 1-25, August.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:16:p:6595-:d:399110
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/12/16/6595/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/12/16/6595/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Trujillo, Lourdes & Nombela, Gustavo, 1999. "Privatization and regulation of the seaport industry," Policy Research Working Paper Series 2181, The World Bank.
    2. Tohru Naito & Hikaru Ogawa, 2009. "Direct versus indirect environmental regulation in a partially privatized mixed duopoly," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 10(2), pages 87-100, June.
    3. Wang, Leonard F.S. & Wang, Jean, 2009. "Environmental taxes in a differentiated mixed duopoly," Economic Systems, Elsevier, vol. 33(4), pages 389-396, December.
    4. Toshihiro Matsumura & Noriaki Matsushima, 2012. "Airport Privatization And International Competition," The Japanese Economic Review, Japanese Economic Association, vol. 63(4), pages 431-450, December.
    5. Estache, Antonio & Gonzalez, Marianela & Trujillo, Lourdes, 2002. "Efficiency Gains from Port Reform and the Potential for Yardstick Competition: Lessons from Mexico," World Development, Elsevier, vol. 30(4), pages 545-560, April.
    6. Lin, Ming Hsin & Zhang, Anming, 2016. "Hub congestion pricing: Discriminatory passenger charges," Economics of Transportation, Elsevier, vol. 5(C), pages 37-48.
    7. Zhang, Anming & Zhang, Yimin, 2003. "Airport charges and capacity expansion: effects of concessions and privatization," Journal of Urban Economics, Elsevier, vol. 53(1), pages 54-75, January.
    8. Shuichi Ohori, 2006. "Optimal Environmental Tax and Level of Privatization in an International Duopoly," Journal of Regulatory Economics, Springer, vol. 29(2), pages 225-233, March.
    9. Bruce A. Blonigen & Wesley W. Wilson, 2008. "Port Efficiency and Trade Flows," Review of International Economics, Wiley Blackwell, vol. 16(1), pages 21-36, February.
    10. Cheon, SangHyun & Dowall, David E. & Song, Dong-Wook, 2010. "Evaluating impacts of institutional reforms on port efficiency changes: Ownership, corporate structure, and total factor productivity changes of world container ports," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 46(4), pages 546-561, July.
    11. repec:hit:hitjcm:v:56:y:2015:i:1:p:135-154 is not listed on IDEAS
    12. Gong, Stephen X.H. & Cullinane, Kevin & Firth, Michael, 2012. "The impact of airport and seaport privatization on efficiency and performance: A review of the international evidence and implications for developing countries," Transport Policy, Elsevier, vol. 24(C), pages 37-47.
    13. Czerny, Achim & Höffler, Felix & Mun, Se-il, 2014. "Hub port competition and welfare effects of strategic privatization," Economics of Transportation, Elsevier, vol. 3(3), pages 211-220.
    14. Sang-Ho Lee & Lili Xu, 2018. "Endogenous timing in private and mixed duopolies with emission taxes," Journal of Economics, Springer, vol. 124(2), pages 175-201, June.
    15. Mantin, Benny, 2012. "Airport complementarity: Private vs. government ownership and welfare gravitation," Transportation Research Part B: Methodological, Elsevier, vol. 46(3), pages 381-388.
    16. García, Arturo & Leal, Mariel & Lee, Sang-Ho, 2018. "Time-inconsistent environmental policies with a consumer-friendly firm: Tradable permits versus emission tax," International Review of Economics & Finance, Elsevier, vol. 58(C), pages 523-537.
    17. Sang-Ho Lee & Lili Xu & Zhao Chen, 2013. "Competitive Privatization And Tariff Policies In An International Mixed Duopoly," Manchester School, University of Manchester, vol. 81(5), pages 763-779, September.
    18. Xu, Lili & Lee, Sang-Ho, 2015. "Strategic Privatization With Tariffs And Environmental Taxes In An International Mixed Duopoly," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 56(1), pages 135-154, June.
    19. Estache, Antonio & Gonzalez, Marianela & Trujillo, Lourdes, 2002. "Efficiency Gains from Port Reform and the Potential for Yardstick Competition: Lessons from Mexico," World Development, Elsevier, vol. 30(4), pages 545-560, April.
    20. Cullinane, Kevin & Song, Dong-Wook & Gray, Richard, 2002. "A stochastic frontier model of the efficiency of major container terminals in Asia: assessing the influence of administrative and ownership structures," Transportation Research Part A: Policy and Practice, Elsevier, vol. 36(8), pages 743-762, October.
    21. Mariel Leal & Arturo Garcia & Sang‐Ho Lee, 2019. "Excess Burden of Taxation and Environmental Policy Mix with a Consumer‐Friendly Firm," The Japanese Economic Review, Japanese Economic Association, vol. 70(4), pages 517-536, December.
    22. 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.
    23. Cullinane, Kevin & Ji, Ping & Wang, Teng-fei, 2005. "The relationship between privatization and DEA estimates of efficiency in the container port industry," Journal of Economics and Business, Elsevier, vol. 57(5), pages 433-462.
    24. Zheng, Shiyuan & Ge, Ying-En & Fu, Xiaowen & Nie, Yu (Marco) & Xie, Chi, 2017. "Modeling collusion-proof port emission regulation of cargo-handling activities under incomplete information," Transportation Research Part B: Methodological, Elsevier, vol. 104(C), pages 543-567.
    25. Guangliang Ye & Jinhua Zhao, 2016. "Environmental Regulation in a Mixed Economy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 65(1), pages 273-295, September.
    26. R. Midoro & E. Musso & F. Parola *, 2005. "Maritime liner shipping and the stevedoring industry: market structure and competition strategies," Maritime Policy & Management, Taylor & Francis Journals, vol. 32(2), pages 89-106, April.
    27. Xu, Lili & Cho, Sumi & Lee, Sang-Ho, 2016. "Emission tax and optimal privatization in Cournot–Bertrand comparison," Economic Modelling, Elsevier, vol. 55(C), pages 73-82.
    28. Theo Notteboom & Chris Coeck & Julien Van Den Broeck, 2000. "Measuring and Explaining the Relative Efficiency of Container Terminals by Means of Bayesian Stochastic Frontier Models," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 2(2), pages 83-106, June.
    29. DongJoon Lee & Seonyoung Lim & Kangsik Choi, 2017. "Port privatization under Cournot vs. Bertrand competition: a third-market approach," Maritime Policy & Management, Taylor & Francis Journals, vol. 44(6), pages 761-778, August.
    30. Carlos Pestana Barros & Manolis Athanassiou, 2004. "Efficiency in European Seaports with DEA: Evidence from Greece and Portugal," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 6(2), pages 122-140, June.
    31. Matsushima, Noriaki & Takauchi, Kazuhiro, 2014. "Port privatization in an international oligopoly," Transportation Research Part B: Methodological, Elsevier, vol. 67(C), pages 382-397.
    32. Kangsik Choi & Seonyoung Lim, 2018. "Tariff protection and port privatization: An import-competing approach," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 20(2), pages 228-252, June.
    33. Robert C. Feenstra & Hong Ma, 2014. "Trade Facilitation and the Extensive Margin of Exports," The Japanese Economic Review, Japanese Economic Association, vol. 65(2), pages 158-177, June.
    34. Oum, Tae H. & Yan, Jia & Yu, Chunyan, 2008. "Ownership forms matter for airport efficiency: A stochastic frontier investigation of worldwide airports," Journal of Urban Economics, Elsevier, vol. 64(2), pages 422-435, September.
    35. Beladi, Hamid & Chao, Chi-Chur, 2006. "Does privatization improve the environment?," Economics Letters, Elsevier, vol. 93(3), pages 343-347, December.
    36. Anthony M. Pagano & Grace W.Y. Wang & Onésimo V. Sánchez & Ricardo Ungo, 2013. "Impact of privatization on port efficiency and effectiveness: results from Panama and US ports," Maritime Policy & Management, Taylor & Francis Journals, vol. 40(2), pages 100-115, March.
    37. Yibin Xiao & Adolf K.Y. Ng & Hangjun Yang & Xiaowen Fu, 2012. "An Analysis of the Dynamics of Ownership, Capacity Investments and Pricing Structure of Ports," Transport Reviews, Taylor & Francis Journals, vol. 32(5), pages 629-652, June.
    38. Kenzo Abe & Keisuke Hattori & Yoshitaka Kawagoshi, 2014. "Trade Liberalization and Environmental Regulation on International Transportation," The Japanese Economic Review, Japanese Economic Association, vol. 65(4), pages 468-482, December.
    39. Czerny, Achim I., 2013. "Public versus private airport behavior when concession revenues exist," Economics of Transportation, Elsevier, vol. 2(1), pages 38-46.
    40. Tongzon, Jose & Heng, Wu, 2005. "Port privatization, efficiency and competitiveness: Some empirical evidence from container ports (terminals)," Transportation Research Part A: Policy and Practice, Elsevier, vol. 39(5), pages 405-424, June.
    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. Xu, Lili & Lee, Sang-Ho, 2021. "Port integration and competition under public and private ownership," MPRA Paper 106127, University Library of Munich, Germany.
    2. Yan Zhou & Haiying Zhou, 2024. "The Emission Reduction Technology Decision of the Port Supply Chain," Mathematics, MDPI, vol. 12(6), pages 1-20, March.
    3. Wang, Jian & Zhu, Wenbo, 2023. "Analyzing the development of competition and cooperation among ocean carriers considering the impact of carbon tax policy," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 175(C).

    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. Kangsik Choi & Seonyoung Lim, 2018. "Tariff protection and port privatization: An import-competing approach," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 20(2), pages 228-252, June.
    2. DongJoon Lee & Seonyoung Lim & Kangsik Choi, 2017. "Port privatization under Cournot vs. Bertrand competition: a third-market approach," Maritime Policy & Management, Taylor & Francis Journals, vol. 44(6), pages 761-778, August.
    3. Güner, Samet, 2015. "Investigating infrastructure, superstructure, operating and financial efficiency in the management of Turkish seaports using data envelopment analysis," Transport Policy, Elsevier, vol. 40(C), pages 36-48.
    4. Suárez-Alemán, Ancor & Morales Sarriera, Javier & Serebrisky, Tomás & Trujillo, Lourdes, 2016. "When it comes to container port efficiency, are all developing regions equal?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 86(C), pages 56-77.
    5. Wang, Wei & Liu, Xiujuan & Ding, Lili & Li, Chen & Zhang, Wensi, 2018. "The optimal port privatization levels under inter-port competition: Considering both horizontal and vertical differentiation," Economics Discussion Papers 2018-84, Kiel Institute for the World Economy (IfW Kiel).
    6. Meccheri, Nicola, 2023. "Unionised dockworkers and port ownership structure in an international oligopoly," GLO Discussion Paper Series 1326, Global Labor Organization (GLO).
    7. Merkel, Axel & Holmgren, Johan, 2017. "Dredging the depths of knowledge: Efficiency analysis in the maritime port sector," Transport Policy, Elsevier, vol. 60(C), pages 63-74.
    8. Odeck, James & Bråthen, Svein, 2012. "A meta-analysis of DEA and SFA studies of the technical efficiency of seaports: A comparison of fixed and random-effects regression models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(10), pages 1574-1585.
    9. Shui-Mu Ju & Nan Liu, 2015. "Efficiency and its influencing factors in port enterprises: empirical evidence from Chinese port-listed companies," Maritime Policy & Management, Taylor & Francis Journals, vol. 42(6), pages 571-590, August.
    10. Gonzalez, M. & Trujillo, L., 2007. "Efficiency measurement in the port industry: a survey of the empirical evidence," Working Papers 07/08, Department of Economics, City University London.
    11. Odeck, James & Schøyen, Halvor, 2020. "Productivity and convergence in Norwegian container seaports: An SFA-based Malmquist productivity index approach," Transportation Research Part A: Policy and Practice, Elsevier, vol. 137(C), pages 222-239.
    12. Pérez, Ivone & Trujillo, Lourdes & González, María Manuela, 2016. "Efficiency determinants of container terminals in Latin American and the Caribbean," Utilities Policy, Elsevier, vol. 41(C), pages 1-14.
    13. SangHyun Cheon & Dong-Wook Song & Sungjin Park, 2018. "Does more competition result in better port performance?," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 20(3), pages 433-455, September.
    14. Matsushima, Noriaki & Takauchi, Kazuhiro, 2014. "Port privatization in an international oligopoly," Transportation Research Part B: Methodological, Elsevier, vol. 67(C), pages 382-397.
    15. Yang, Dong & Li, Lu & Notteboom, Theo, 2022. "Chinese investment in overseas container terminals: The role of investor attributes in achieving a higher port competitiveness," Transport Policy, Elsevier, vol. 118(C), pages 112-122.
    16. Pierre CARIOU & Gabriel FIGUEIREDO DE OLIVEIRA, 2015. "Les Déterminants De L'Efficience Portuaire : Une Analyse Des Ports À Conteneurs Méditerranéens," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 41, pages 83-99.
    17. Suárez-Alemán, Ancor & Morales Sarriera, Javier & Serebrisky, Tomás & Trujillo, Lourdes, 2016. "When it comes to container port efficiency, are all developing regions equal?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 86(C), pages 56-77.
    18. Czerny, Achim & Höffler, Felix & Mun, Se-il, 2013. "Port Competition and Welfare Effect of Strategic Privatization," EWI Working Papers 2013-13, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    19. Cheon, SangHyun, 2007. "World Port Institutions and Productivity: Roles of Ownership, Corporate Structure, and Inter-port Competition," University of California Transportation Center, Working Papers qt7t64h5wr, University of California Transportation Center.
    20. Antonio Affuso & Cataldo Ferrarese & Guido Nannariello, 2013. "Spending Review: un?analisi di efficienza delle Capitanerie di porto," SCIENZE REGIONALI, FrancoAngeli Editore, vol. 2013(3), pages 111-143.

    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:gam:jsusta:v:12:y:2020:i:16:p:6595-:d:399110. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.