ID : 1929 - 0128 - 2015 - 03 - 38 - 15 , Nam Kyu Park , and Sang Cheol Suh

Due to the expansion of container port facilities and many market suppliers, competition among container terminals (CTs) is at the level of threatening the management income and expenditure of port management companies. This paper develops a noncooperative game model and a cooperative game model which involve four CTs located in North Port and two terminals in New port of Busan, Republic of Korea. We apply a game theory for strategic decision making at CTs. A non-cooperative game and a cooperative game are played when managers make decisions together and try to overcome the competition and neglect the mutual profit. Therefore, the purpose of this paper is to find equilibrium price and profit between CTs that are in competitive relation. In order to satisfy the proposed goals, it is required to find what service factors are most important to the shipping companies when they select ports. The solving model of this problem assumes the cooperation of individual terminals as if several TOCs will be a united company in terms of decision making. The Bertrand Nash game model is used to solve this problem. A comparison between current and equilibrium price and profit represents the main goal of applying the game theory.