Inter-port price competition in a multi-port gateway region

The purpose of this paper is to study the inter-port pricing strategy in a Multi-Port Gateway Region (MPGR) under the background of deregulating port competitive service charges. We apply a two-stage game to explore the pricing strategies adopted by the container ports in an MPGR. The resulting price matching strategy is the unique subgame perfect Nash Equilibrium of the two-stage game even though the container ports in an MPGR have different variable costs. A numerical simulation is performed on Ningbo-Zhoushan and Shanghai Ports in Yangtze River Delta Region to demonstrate the results.