A Study on the Performance of Concession Contracts between Port Authority and Terminal Operators

This study examines the performance of port authorities and terminal operators under different types of concession contracts in ports. The port authority signs into a concession contract with the terminal operator to receive fee, and the operator utilizes the terminal to provide loading and unloading services. The demand at the port is affected by the terminal operator's price and service level. This study analyzes the performance of each model using game theory under three different concession schemes: two-part tariff model, revenue-sharing model, and revenue-cost-sharing model. The results show that the revenue-sharing model can improve the profitability of port authorities and terminal operators compared to the two-part tariff model, but it may result in lower service levels at the terminal. On the other hand, the revenue-cost-sharing model can improve both the profit and the service level of each party compared to the two-part tariff model, and can achieve higher performance than the revenue- sharing mode. The significance of this study is that it analyzes the revenue sharing model, which has not been studied much in the past, and considers the service level in analyzing the effect of concession contracts.