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Concepts, methods and purposes of productivity measurement in transportation

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  • Oum, Tae H.
  • Tretheway, Michael W.
  • Waters, W. G.
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    Abstract

    This paper discusses alternative concepts of productivity and methods of measurement. Different measures are appropriate for different questions. Partial factor productivity measures, such as the ever-popular labour productivity, are appropriate where disaggregate operational performance is of interest. Labour productivity is also the relevant measure for assessing the long term standard of living of a nation. Total Factor Productivity (TFP) is the appropriate concept for most productivity assessments, including comparisons across firms or inductries, or over time. TFP is alos relevant for pricing policies and for many public policy questions. However, TFP itself is an ambiguous concept. "Shift" measures of TFP measure productivity gains from fundamental changes in technology or managerial organization. Shift measures require statistical analysis via estimation of cost or production functions, or via some other decomposition of "gross" measures of TFP. Gross TFP measures productivity gains from all sources: whether due to technical (managerial) progress, or from exploitation of economies of scale, etc. Gross TFP measures are generally appropriate for pricing questions, while shift measures often are appropriate for government policy questions. The paper describes six alternative techniques for measuring gross TFP, and provides guidance as to which techniques might be preferred in a particular situation.

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    Bibliographic Info

    Article provided by Elsevier in its journal Transportation Research Part A: Policy and Practice.

    Volume (Year): 26 (1992)
    Issue (Month): 6 (November)
    Pages: 493-505

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    Handle: RePEc:eee:transa:v:26:y:1992:i:6:p:493-505

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    Cited by:
    1. Oum, Tae Hoon & Pathomsiri, Somchai & Yoshida, Yuichiro, 2013. "Limitations of DEA-based approach and alternative methods in the measurement and comparison of social efficiency across firms in different transport modes: An empirical study in Japan," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 57(C), pages 16-26.
    2. Savage, Ian, 2004. "Management objectives and the causes of mass transit deficits," Transportation Research Part A: Policy and Practice, Elsevier, vol. 38(3), pages 181-199, March.
    3. Luisa Affuso & Alvaro Angeriz & Michael Pollitt, 2009. "The Impact of Privatisation on the Efficiency of Train Operation in Britain," Working Papers 28, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
    4. Choo, Yap Yin & Oum, Tae Hoon, 2013. "Impacts of low cost carrier services on efficiency of the major U.S. airports," Journal of Air Transport Management, Elsevier, vol. 33(C), pages 60-67.
    5. Kerstens, K., 1996. "Technical efficiency measurement and explanation of French urban transit companies," Transportation Research Part A: Policy and Practice, Elsevier, vol. 30(6), pages 431-452, November.
    6. Hensher, David A & Daniels, Rhonda, 1995. "Productivity measurement in the urban bus sector," Transport Policy, Elsevier, vol. 2(3), pages 179-194, July.
    7. Obeng, K. & Sakano, R., 2008. "Public transit subsidies, output effect and total factor productivity," Research in Transportation Economics, Elsevier, vol. 23(1), pages 85-98, January.
    8. Pedersen, Pål Andreas, 2003. "On the optimal fare policies in urban transportation," Transportation Research Part B: Methodological, Elsevier, vol. 37(5), pages 423-435, June.

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