Network design approach for hub ports-shipping companies competition and cooperation

In the maritime industry, the stakeholders comprising the port authorities, shipping companies, and port operators often compete and collaborate within an ecological system. This paper investigates the competition and cooperation strategies amongst three parties: two major container hub ports and the shipping companies. This research develops a game theoretic network design model which considers three scenarios: (i) perfect competition between the hub ports, (ii) perfect cooperation between the hub ports, and (iii) cooperation between the shipping companies and the hub ports as a whole. The scenarios are tested using empirical data from two leading Asian hub ports: Singapore and Hong Kong. An interval branch and bound is designed to solve the models. Crown Copyright (C) 2012 Published by Elsevier Ltd. All rights reserved.