Investment in container terminals with game theory approach

Present study has examined an optimal strategy for potential investments that may be accepted to attract more ships. A mathematical model has been set up to identify the basic criteria used by shipping companies to evaluate a particular port. Then, a game theory approach has been used for a competitive model between several important ports to attract shipping companies through maximizing their utility functions. In this way, a secret game type with one turn has been suggested. The results showed that optimal investment strategy used by a particular port depends on1) current status of port relative to other competitive ports, 2) available resources in terms of manpower and capital, 3) profit forecasting and 4) other officials' responses relative to the capital. Present study informs a strong port to maximize returns in the case of winning in auction through choosing to invest in the port and minimizing potential losses as well as minimizing potential losses in the case of failure on auction through discarding any investment.