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RESEARCH PRODUCT
Vertical integration and exclusivities in maritime freight transport
José J. Sempere-monerrisPedro Cantos-sánchezÓScar ÁLvarez-sanjaimeRafael Moner-colonquessubject
Service (business)Engineeringbusiness.industryOpen portjel:L91TransportationShipping lineVertical integrationVariety (cybernetics)Transport engineeringfreight transport shipping lines vertical integrationTerminal (electronics)jel:L13Key (cryptography)jel:R40Profitability indexBusiness and International ManagementbusinessTelecommunicationsCivil and Structural Engineeringdescription
A key recent theme in maritime freight transport is the involvement of shipping lines in terminal management. Such investments are costly but allow liners to provide better service. Most of these new terminals are dedicated terminals but some are non-exclusive and let rivals access them for a fee. In this paper, we show that a shipping line that builds its own terminal finds it strategically profitable (i) to continue routing part of its cargo through the open port facilities, and (ii) to keep its terminal non-exclusive. In this way, the liner investor pushes part of the rival's freight from the open to the new terminal. Besides, under non-exclusivities, the shipping lines offer a wider variety of services, total freight increases and the resulting equilibrium fares are higher than with a dedicated terminal.
| year | journal | country | edition | language |
|---|---|---|---|---|
| 2011-03-01 |