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Port Privatization in an International Oligopoly

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  • Noriaki Matsushima
  • Kazuhiro Takauchi

Abstract

We investigate how port privatization affects port charges, firm profits, and welfare. Our model consists of an international duopoly with two ports and two markets. When the unit transport cost is large, privatization of ports decreases the prices for port usage, although neither government has an incentive to privatize its port. The equilibrium governmental decisions are inconsistent with the desirable outcome if the unit transport cost is not large enough. The smaller countryfs government is more likely to privatize its port, although the larger countryfs government is more likely to nationalize its port to protect its domestic market.

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Bibliographic Info

Paper provided by Institute of Social and Economic Research, Osaka University in its series ISER Discussion Paper with number 0864.

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Date of creation: Feb 2013
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Handle: RePEc:dpr:wpaper:0864

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  11. Toshihiro Matsumura & Noriaki Matsushima, 2010. "Airport privatization and international competition," ISER Discussion Paper 0792, Institute of Social and Economic Research, Osaka University.
  12. Mantin, Benny, 2012. "Airport complementarity: Private vs. government ownership and welfare gravitation," Transportation Research Part B: Methodological, Elsevier, vol. 46(3), pages 381-388.
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