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Allocation Methods for Port Incentives at Gwangyang Port  

Sung, Souk-Kyung (전남대학교 경상학부)
Park, Byung-In (전남대학교 물류교통학전공)
Publication Information
Journal of Korea Port Economic Association / v.29, no.2, 2013 , pp. 1-17 More about this Journal
Abstract
This paper aims to review the fairness of carriers' incentive schemes at Gwangyang port in 2010 and to show the desirable incentive allocation rules using the proportional and egalitarian rules under cooperative game theory. The carriers' incentive schemes at Gwangyang port in 2010 did not meet the no-envy and the efficiency, and satisfy the symmetry axiom. According to the research findings, the equal surplus method satisfies the axioms of equity, efficiency, symmetry, and progressivity. However, the uniform losses method meets the axioms of equity, efficiency, symmetry, and regressivity. We use a single allocation criterion of the total throughput to show the regressivity and the symmetry principles into the incentive scheme instead of using multiple criteria such as total throughput, increased volume, and coastal volume. The uniform losses method based on the total throughput can distribute the incentive amount according to the intent of the incentive schemes. Hence, we need to establish a rationing system to allocate reasonably the total amount of different types of incentives, avoiding the temptation to adjust the volume shipped between the ports of carriers considering the efficiency of allocation.
Keywords
Port Incentives; Allocation Rule; Equity; Efficiency; Regressivity; Symmetry;
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Times Cited By KSCI : 1  (Citation Analysis)
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