Structure and Conduct of the Ocean Freight Cargo Container Industry

Abstract

The existence of globalization increases economic activity between countries. International trade activities are divided into two categories: exports and imports. Sea mode transportation requires tools to transport goods safely from the origin country to the destination country. These tools are called containers or cargo containers. The cargo container shipping industry is an industry that provides containers. The purpose of this study are to: 1) prove that the market structure in the ocean freight container cargo industry is oligopoly, 2) analyse the influence of market structure on behaviour in the ocean freight container cargo industry, and 3) prove the existence of market power in the ocean freight container cargo industry. This research uses time series data from 2010–2022 and cross section data from 100 companies. Data collection was conducted through non-participant observation and interviews. By using secondary data from companies in the global cargo container industry and interviews. Using SCP theory, the analysis techniques used are concentration ratio, HHI, market entry barriers, behaviour, and market performance. The results of the study found that the cargo container industry market is a moderately low-concentration oligopoly with high market entry barriers. Market structure influences corporate behaviour in the container industry. Market structure and company behaviour affect market performance through market power.