The object of this paper is to discuss some of the problems involved in trying to integrate the pricing practices of international liner services into a theoretical model. My concern is with liner services provided by shipping lines operating within the limitations imposed by a conference which controls the trade concerned. Conferences are controlling bodies, appointed by and from the liner owners themselves, under the control of the owners concerned and in turn controlling them in their operations in a trade. Usually a conference covers only one trade and consists of several lines. Any line may be a member of a number of conferences, each covering a different trade. Conferences must not be thought of as actually controlling lines: what they do is to control most aspects of the competitive actions of lines within individual trades.
KeywordsMarginal Cost Price Policy Entry Cost Freight Rate Rate Schedule
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- 10.Such a policy is better considered in terms of maximising the net present value of the enterprise than of maximizing long-run profits: see W. Fellner, Competition Among the Few (New York: Augustus Kelly, ‘Reprints of Economic Classics’, 1960).Google Scholar