Pricing and competition in a shipping market with waste shipments and empty container repositioning

Rongying Chen; Jing Xin Dong; Chung Yee Lee

doi:10.1016/j.trb.2015.12.012

Pricing and competition in a shipping market with waste shipments and empty container repositioning

Rongying Chen
, Jing Xin Dong
, Chung Yee Lee^*

^*Corresponding author for this work

Department of Industrial Engineering and Decision Analytics

Research output: Contribution to journal › Journal Article › peer-review

62 Citations (Scopus)

Abstract

In this paper, we study a shipping market with carriers providing services between two locations. Shipments are classified into two categories: goods and waste. Trade imbalance allows low-valued waste to be shipped at bargain rates. If imbalance persists, empty containers must be repositioned from a surplus location to a shortage location. Carriers decide prices, which will affect the demand. We build a monopoly and a duopoly model to find the optimal pricing strategy for carriers. We also analyze how the profit of a carrier is affected by price sensitivity, cost structure and competition intensity.

Original language	English
Pages (from-to)	32-55
Number of pages	24
Journal	Transportation Research Part B: Methodological
Volume	85
DOIs	https://doi.org/10.1016/j.trb.2015.12.012
Publication status	Published - 1 Mar 2016

Bibliographical note

Publisher Copyright:
© 2015 Elsevier Ltd.

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 12 Responsible Consumption and Production

Keywords

Empty container repositioning
Price competition
Waste shipment

Access to Document

10.1016/j.trb.2015.12.012

Cite this

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abstract = "In this paper, we study a shipping market with carriers providing services between two locations. Shipments are classified into two categories: goods and waste. Trade imbalance allows low-valued waste to be shipped at bargain rates. If imbalance persists, empty containers must be repositioned from a surplus location to a shortage location. Carriers decide prices, which will affect the demand. We build a monopoly and a duopoly model to find the optimal pricing strategy for carriers. We also analyze how the profit of a carrier is affected by price sensitivity, cost structure and competition intensity.",

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AU - Chen, Rongying

AU - Dong, Jing Xin

AU - Lee, Chung Yee

PY - 2016/3/1

Y1 - 2016/3/1

N2 - In this paper, we study a shipping market with carriers providing services between two locations. Shipments are classified into two categories: goods and waste. Trade imbalance allows low-valued waste to be shipped at bargain rates. If imbalance persists, empty containers must be repositioned from a surplus location to a shortage location. Carriers decide prices, which will affect the demand. We build a monopoly and a duopoly model to find the optimal pricing strategy for carriers. We also analyze how the profit of a carrier is affected by price sensitivity, cost structure and competition intensity.

AB - In this paper, we study a shipping market with carriers providing services between two locations. Shipments are classified into two categories: goods and waste. Trade imbalance allows low-valued waste to be shipped at bargain rates. If imbalance persists, empty containers must be repositioned from a surplus location to a shortage location. Carriers decide prices, which will affect the demand. We build a monopoly and a duopoly model to find the optimal pricing strategy for carriers. We also analyze how the profit of a carrier is affected by price sensitivity, cost structure and competition intensity.

KW - Empty container repositioning

KW - Price competition

KW - Waste shipment

UR - https://www.webofscience.com/wos/woscc/full-record/WOS:000372683100003

UR - https://openalex.org/W2278303305

U2 - 10.1016/j.trb.2015.12.012

DO - 10.1016/j.trb.2015.12.012

M3 - Journal Article

SN - 0191-2615

VL - 85

SP - 32

EP - 55

JO - Transportation Research Part B: Methodological

JF - Transportation Research Part B: Methodological

ER -

Pricing and competition in a shipping market with waste shipments and empty container repositioning

Abstract

Bibliographical note

UN SDGs

Keywords

Access to Document

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