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A Theoretical Framework For The Evaluation Of Competition Between Container Terminal Operators

Author

Listed:
  • WEI YIM YAP

    (Institute of Transport and Maritime Management Antwerp (ITMMA), University of Antwerp, Keizerstraat 64, B-2000 Antwerp, Belgium)

  • JASMINE SIU LEE LAM

    (Division of Infrastructure Systems and Maritime Studies, School of Civil and Environmental Engineering, Nanyang Technological University, 50 Nanyang Avenue, Singapore, 639798, Singapore)

  • KEVIN CULLINANE

    (Transport Research Institute (TRi), Edinburgh Napier University, Merchiston Campus, Edinburgh EH10 5DT, Scotland, UK)

Abstract

This paper presents a conceptual framework for analyzing the outcomes of potential competitive strategies and their expected payoffs for container terminal operators in the container handling industry. The framework is based on the integration of Bowley's linear model of aggregate demand of product differentiation with Porter's "Diamond" model. It focuses on the number of containers handled, prices charged, and profits earned to analyze a variety of strategies that could be employed by container terminal operators to enhance their competitive position. The findings suggest that strategies to build complementary relationships and stimulate greater demand are more desirable than alternatives because they generate benefits that accrue to the entire container port cluster. Conversely, strategies that are intended to raise entry barriers, employ strategic pricing mechanisms, and/or involve collusion are found to lead to the formation of insular clusters and retard competitive advantage in the long-run.

Suggested Citation

  • Wei Yim Yap & Jasmine Siu Lee Lam & Kevin Cullinane, 2011. "A Theoretical Framework For The Evaluation Of Competition Between Container Terminal Operators," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 56(04), pages 535-559.
    • Handle: RePEc:wsi:serxxx:v:56:y:2011:i:04:n:s0217590811004456
    DOI: 10.1142/S0217590811004456
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    References listed on IDEAS

    as
    1. Bramness, Gunnar, 1979. "The General Conjectural Model of Oligopoly - Some Classical Points Revisited," The Warwick Economics Research Paper Series (TWERPS) 142, University of Warwick, Department of Economics.
    2. Teng-Fei Wang & Kevin Cullinane & Dong-Wook Song, 2005. "Container Port Production and Economic Efficiency," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-50597-1.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Marasco, Addolorata & Romano, Alessandro, 2018. "Inter-port interactions in the Le Havre-Hamburg range: A scenario analysis using a nonautonomous Lotka Volterra model," Journal of Transport Geography, Elsevier, vol. 69(C), pages 207-220.
    2. Koliousis, Ioannis G. & Papadimitriou, Stratos & Riza, Elena & Stavroulakis, Peter J. & Tsioumas, Vangelis, 2019. "Strategic correlations for maritime clusters," Transportation Research Part A: Policy and Practice, Elsevier, vol. 120(C), pages 43-57.

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    More about this item

    Keywords

    Container terminal; port competition; port competitiveness; port complementarity; product differentiation; oligopoly; C51; D43; L11; L13; L41;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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