Download this Paper Open PDF in Browser

Port Privatization in an International Oligopoly

31 Pages Posted: 15 Feb 2013  

Noriaki Matsushima

Osaka University - Institute of Social and Economic Research (ISER)

Kazuhiro Takauchi

Onomichi City University

Date Written: February 10, 2013

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 country’s government is more likely to privatize its port, although the larger country’s government is more likely to nationalize its port to protect its domestic market.

Keywords: Port Privatization, Port charge, Oligopoly, Strategic trade policy

JEL Classification: L33, F12, R48, F13

Suggested Citation

Matsushima, Noriaki and Takauchi, Kazuhiro, Port Privatization in an International Oligopoly (February 10, 2013). ISER Discussion Paper No. 864. Available at SSRN: https://ssrn.com/abstract=2216358 or http://dx.doi.org/10.2139/ssrn.2216358

Noriaki Matsushima (Contact Author)

Osaka University - Institute of Social and Economic Research (ISER) ( email )

6-1 Mihogaoka
Ibaraki, Osaka 567-0047
Japan

Kazuhiro Takauchi

Onomichi City University ( email )

1600 Hisayamada
Onomichi, Hiroshima
Japan

Paper statistics

Downloads
76
Rank
267,327
Abstract Views
495