IDEAS home Printed from https://ideas.repec.org/a/eee/ecotra/v11-12y2017ip33-48.html
   My bibliography  Save this article

Are vessel sharing agreements pro-competitive?

Author

Listed:
  • Quartieri, Federico

Abstract

Attention is focussed on a type of strategic alliance of the container shipping industry: vessel sharing agreements. In such consortia carriers jointly provide—but independently sell—a liner service. The strategic alliances studied in this work have not been extensively analyzed in the theoretical literature; a new model is proposed that embodies their main distinguishing features. By it, an examination is provided of the effects on equilibrium prices, equilibrium aggregate quantities and consumer welfare of the formation and enlargement of vessel sharing agreements. A positive answer is developed to the question raised in the title of the present work that supports a laissez-faire policy for these consortia.

Suggested Citation

  • Quartieri, Federico, 2017. "Are vessel sharing agreements pro-competitive?," Economics of Transportation, Elsevier, vol. 11, pages 33-48.
    • Handle: RePEc:eee:ecotra:v:11-12:y:2017:i::p:33-48
    DOI: 10.1016/j.ecotra.2017.10.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S2212012217300436
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ecotra.2017.10.004?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., 2013. "Competition and horizontal integration in maritime freight transport," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 51(C), pages 67-81.
    2. Ken Hendricks & Michele Piccione & Guofu Tan, 1995. "The Economics of Hubs: The Case of Monopoly," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 62(1), pages 83-99.
    3. Farrell, Joseph & Shapiro, Carl, 1990. "Horizontal Mergers: An Equilibrium Analysis," American Economic Review, American Economic Association, vol. 80(1), pages 107-126, March.
    4. Chen, Zhiqi & Ross, Thomas W., 2003. "Cooperating upstream while competing downstream: a theory of input joint ventures," International Journal of Industrial Organization, Elsevier, vol. 21(3), pages 381-397, March.
    5. Nagurney, Anna & Saberi, Sara & Shukla, Shivani & Floden, Jonas, 2015. "Supply chain network competition in price and quality with multiple manufacturers and freight service providers," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 77(C), pages 248-267.
    6. Sue H. Mialon, 2014. "Product Bundling And Incentives For Mergers And Strategic Alliances," Economic Inquiry, Western Economic Association International, vol. 52(2), pages 562-575, April.
    7. Sys, Christa, 2009. "Is the container liner shipping industry an oligopoly?," Transport Policy, Elsevier, vol. 16(5), pages 259-270, September.
    8. Szidarovszky, F & Yakowitz, S, 1977. "A New Proof of the Existence and Uniqueness of the Cournot Equilibrium," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(3), pages 787-789, October.
    9. Park, Jong-Hun & Zhang, Anming & Zhang, Yimin, 2001. "Analytical models of international alliances in the airline industry," Transportation Research Part B: Methodological, Elsevier, vol. 35(9), pages 865-886, November.
    10. Volodymyr Bilotkach, 2005. "Price Competition between International Airline Alliances," Journal of Transport Economics and Policy, University of Bath, vol. 39(2), pages 167-190, May.
    11. Talley, Wayne K. & Ng, ManWo, 2013. "Maritime transport chain choice by carriers, ports and shippers," International Journal of Production Economics, Elsevier, vol. 142(2), pages 311-316.
    12. Zhinqi Chen & Thomas W. Ross, 2000. "Strategic Alliances, Shared Facilities, and Entry Deterrence," RAND Journal of Economics, The RAND Corporation, vol. 31(2), pages 326-344, Summer.
    13. Acemoglu, Daron & Jensen, Martin Kaae, 2013. "Aggregate comparative statics," Games and Economic Behavior, Elsevier, vol. 81(C), pages 27-49.
    14. Szidarovszky, F. & Yakowitz, S., 1982. "Contributions to Cournot oligopoly theory," Journal of Economic Theory, Elsevier, vol. 28(1), pages 51-70, October.
    15. Tae Hoon Oum & Anming Zhang & Yimin Zhang, 1995. "Airline Network Rivalry," Canadian Journal of Economics, Canadian Economics Association, vol. 28(4a), pages 836-857, November.
    16. Pierre von Mouche & Federico Quartieri, 2015. "Cournot Equilibrium Uniqueness in Case of Concave Industry Revenue: a Simple Proof," Economics Bulletin, AccessEcon, vol. 35(2), pages 1299-1305.
    17. Zhang, Anming & Zhang, Yimin, 2006. "Rivalry between strategic alliances," International Journal of Industrial Organization, Elsevier, vol. 24(2), pages 287-301, March.
    18. Yamada, Tadashi & Febri, Zukhruf, 2015. "Freight transport network design using particle swarm optimisation in supply chain–transport supernetwork equilibrium," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 75(C), pages 164-187.
    19. Brian Slack & Claude Comtois & Robert McCalla, 2002. "Strategic alliances in the container shipping industry: a global perspective," Maritime Policy & Management, Taylor & Francis Journals, vol. 29(1), pages 65-76, January.
    20. Yamada, Tadashi & Imai, Koji & Nakamura, Takamasa & Taniguchi, Eiichi, 2011. "A supply chain-transport supernetwork equilibrium model with the behaviour of freight carriers," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 47(6), pages 887-907.
    21. Brueckner, Jan K., 2001. "The economics of international codesharing: an analysis of airline alliances," International Journal of Industrial Organization, Elsevier, vol. 19(10), pages 1475-1498, December.
    22. 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.
    23. Chen, Yongmin & Gayle, Philip G., 2007. "Vertical contracting between airlines: An equilibrium analysis of codeshare alliances," International Journal of Industrial Organization, Elsevier, vol. 25(5), pages 1046-1060, October.
    24. Orit Hassin & Oz Shy, 2004. "Code‐sharing Agreements and Interconnections in Markets for International Flights," Review of International Economics, Wiley Blackwell, vol. 12(3), pages 337-352, August.
    25. Panayides, Photis M. & Wiedmer, Robert, 2011. "Strategic alliances in container liner shipping," Research in Transportation Economics, Elsevier, vol. 32(1), pages 25-38.
    26. Park, Jong-Hun, 1997. "The effects of airline alliances on markets and economic welfare," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 33(3), pages 181-195, 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. Daniele Crotti & Claudio Ferrari & Alessio Tei, 2020. "Merger waves and alliance stability in container shipping," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 22(3), pages 446-472, September.
    2. Mohammad Ghorbani & Michele Acciaro & Sandra Transchel & Pierre Cariou, 2022. "Strategic alliances in container shipping: A review of the literature and future research agenda," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 24(2), pages 439-465, June.

    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. Brueckner, Jan K. & Flores-Fillol, Ricardo, 2020. "Market structure and quality determination for complementary products: Alliances and service quality in the airline industry," International Journal of Industrial Organization, Elsevier, vol. 68(C).
    2. Brueckner, Jan K. & Proost, Stef, 2010. "Carve-outs under airline antitrust immunity," International Journal of Industrial Organization, Elsevier, vol. 28(6), pages 657-668, November.
    3. Calzada, Joan & Fageda, Xavier & Safronov, Roman, 2022. "How do global airline alliances affect flight frequency? Evidence from Russia," Journal of Air Transport Management, Elsevier, vol. 98(C).
    4. Achim I. Czerny, 2008. "Code-sharing, price discrimination and welfare losses," WHU Working Paper Series - Economics Group 08-05, WHU - Otto Beisheim School of Management.
    5. Brueckner Jan K. & Picard Pierre M., 2013. "Airline Alliances, Carve-Outs and Collusion," Review of Network Economics, De Gruyter, vol. 12(2), pages 211-227, June.
    6. Chun, So Yeon & Kleywegt, Anton J & Shapiro, Alexander, 2011. "Revenue management in resource exchange seller alliances," MPRA Paper 34657, University Library of Munich, Germany.
    7. Alderighi, Marco & Gaggero, Alberto A., 2014. "The effects of global alliances on international flight frequencies: Some evidence from Italy," Journal of Air Transport Management, Elsevier, vol. 39(C), pages 30-33.
    8. Xia, Wenyi & Zhang, Anming, 2016. "High-speed rail and air transport competition and cooperation: A vertical differentiation approach," Transportation Research Part B: Methodological, Elsevier, vol. 94(C), pages 456-481.
    9. Anming Zhang & Yimin Zhang & Joseph A. Clougherty, 2011. "Competition and Regulation in Air Transport," Chapters, in: André de Palma & Robin Lindsey & Emile Quinet & Roger Vickerman (ed.), A Handbook of Transport Economics, chapter 35, Edward Elgar Publishing.
    10. Bilotkach, Volodymyr & Fageda, Xavier & Flores-Fillol, Ricardo, 2013. "Airline consolidation and the distribution of traffic between primary and secondary hubs," Regional Science and Urban Economics, Elsevier, vol. 43(6), pages 951-963.
    11. Rafael Moner Colonques & Ricardo Flores Fillol, 2006. "Strategic Effects Of Airline Alliances," Working Papers. Serie AD 2006-06, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    12. Gayle Philip G. & Thomas Tyson, 2015. "Product Quality Effects of International Airline Alliances, Antitrust Immunity, and Domestic Mergers," Review of Network Economics, De Gruyter, vol. 14(1), pages 45-74, March.
    13. Alderighi, Marco & Gaggero, Alberto A. & Piga, Claudio A., 2015. "The effect of code-share agreements on the temporal profile of airline fares," Transportation Research Part A: Policy and Practice, Elsevier, vol. 79(C), pages 42-54.
    14. Zhang, Anming, 2005. "Competition Models of Strategic Alliances," Research in Transportation Economics, Elsevier, vol. 13(1), pages 75-100, January.
    15. Menezes Bezerra Sampaio, Raquel & Urdanoz, Miguel, 2022. "Airlines' cooperation in the US domestic market: Measuring the evolution of price gaps," Transportation Research Part A: Policy and Practice, Elsevier, vol. 166(C), pages 424-443.
    16. Volodymyr Bilotkach, 2019. "Airline Partnerships, Antitrust Immunity, and Joint Ventures: What We Know and What I Think We Would Like to Know," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(1), pages 37-60, February.
    17. Fageda, Xavier & Flores-Fillol, Ricardo & Theilen, Bernd, 2019. "Hybrid cooperation agreements in networks: The case of the airline industry," International Journal of Industrial Organization, Elsevier, vol. 62(C), pages 194-227.
    18. Mohammad Ghorbani & Michele Acciaro & Sandra Transchel & Pierre Cariou, 2022. "Strategic alliances in container shipping: A review of the literature and future research agenda," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 24(2), pages 439-465, June.
    19. Le, Huubinh B. & Yimga, Jules O., 2023. "Codeshare restrictions as antitrust remedy," Transport Policy, Elsevier, vol. 138(C), pages 17-24.
    20. Jan K. Brueckner & Ricardo Flores-Fillol, 2018. "Airline Alliances and Service Quality," CESifo Working Paper Series 7226, CESifo.

    More about this item

    Statistics

    Access and download statistics

    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:ecotra:v:11-12:y:2017:i::p:33-48. 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/locate/ecotra .

    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.