Joint Hub Network Development

CentER Discussion Paper No. 2007-76

Posted: 11 Oct 2007

See all articles by F. Cruijssen

F. Cruijssen

Tilburg University - Tilburg University School of Economics and Management

Peter Borm

Tilburg University - Center for Economic Research (CentER); Tilburg University - Department of Econometrics & Operations Research

Wout Dullaert

University of Antwerp - Institute of Transport and Maritime Management Antwerp (ITMMA); Antwerp Maritime Academy

Herbert Hamers

Tilburg University - Center for Economic Research (CentER); Tilburg University - Department of Econometrics & Operations Research

Date Written: September 2007

Abstract

This paper introduces a framework for joint hub network development. Building a joint physical hub for transhipment of goods is expensive and therefore involves considerable risks for the cooperating companies. In a practical setting, it is unlikely that an entire network will be built at once. Rather, the partners will have a more cautious attitude and build the hub facilities one-by-one. In the proposed framework, every time a new hub is introduced, partners will have the opportunity to decide whether or not they participate (and thus invest) in this network extension. The framework is also applicable in cooperative situations other than hub network development. In cases where multiple (infrastructural) investments have to be made by a consortium of logistics companies, the participants are likely to take advantage of a step-wise approach with gain sharing at intermediate steps. More specifically, the procedure can also benefit maintenance groups, warehouse sharing initiatives, and intermodal groups.

Keywords: Hub Networks, Horizontal Cooperation, Cooperative Game Theory

JEL Classification: C61, C71

Suggested Citation

Cruijssen, F. and Borm, Peter E. M. and Dullaert, Wout and Hamers, Herbert, Joint Hub Network Development (September 2007). CentER Discussion Paper No. 2007-76. Available at SSRN: https://ssrn.com/abstract=1020024 or http://dx.doi.org/10.2139/ssrn.1020024

F. Cruijssen (Contact Author)

Tilburg University - Tilburg University School of Economics and Management ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31 13 466 3063 (Phone)

Peter E. M. Borm

Tilburg University - Center for Economic Research (CentER) ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Tilburg University - Department of Econometrics & Operations Research

Tilburg, 5000 LE
Netherlands

Wout Dullaert

University of Antwerp - Institute of Transport and Maritime Management Antwerp (ITMMA) ( email )

Keizerstraat 64
Antwerp, B-2000
Belgium

HOME PAGE: http://www.itmma.ua.ac.be

Antwerp Maritime Academy ( email )

Noordkasteel Oost 6
Antwerp, 2030
Belgium

HOME PAGE: http://www.hzs.be

Herbert Hamers

Tilburg University - Center for Economic Research (CentER) ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31 13 4666 2660 (Phone)

Tilburg University - Department of Econometrics & Operations Research

Tilburg, 5000 LE
Netherlands

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