A Study on the Effects of Market Structure on Market Performance in Busan Container Terminal

Abstract

The liner industry and the port industry have gone through structural changes during the last decades. Even though there are many existing studies on the shipping industry or on the port industry, studies considering both industries are still insufficient. To fill this gap, this study aims to analyse the relationship between market structure and market performance in case of Busan container port.

In this study, the market is defined as the place where the seller(container terminal operating company) sells services to the buyer(shipping company). Market structure variables as explanatory variables include the buyer concentration as well as the seller concentration. Market performance variables as dependent variables reflect two aspects. To reflect the economic performance, sales per unit and costs per unit data are measured. And to reflect the managerial performance, operating margin ration and price-cost margin data are measured. After measuring the market structure and performance, the effects of market structure variables on four different marker performance variables are analysed. The results support that the market structure affects the market performance.

This study deals with the buyer side market structure and economic performance at the same time. Many studies on the relationship between market structure and performance only considered the seller side market structure and its effects on the managerial performance. However, this study attempts to reflect various aspects. By doing so, this study can help devise policies that are suitable for the port sector.