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The performance of subsidized urban and rural public bus operators: Empirical evidence from Norway

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  • James Odeck
  • Abdulrahim Alkadi

Abstract

The performance of Norwegian subsidized urban and rural bus operators is analyzed to gain insight about factors affecting it. Data Envelopment Analysis (DEA) is used to analyze efficiency differences in the sector. In addition, Mann-Whitney rank test is employed to test for efficiency and scale differences with respect to ownership, region of operation and scope of operation. The results suggest that there is in general a potential for input saving in the whole sector of about 28 percent. Nevertheless, while no significant differences are found between urban and rural operators with respect to input saving and output increasing efficiency scores, rural operators on average have lower mean scale efficiency and a higher variance of scale efficiency. Further, statistical tests using a Mann-Whitney rank test verify the latter. Thus the crucial issue in the Norwegian bus industry is less a question of differences in ownership or economies of scope but more a result of sub-optimal input allocation, which varies according to area of operations; either urban or rural. The analysis presented here also demonstrates that DEA is an appealing procedure for assessing efficiency in the bus industry, which is also easily acceptable to the decision-makers. Copyright Springer-Verlag 2004

Suggested Citation

  • James Odeck & Abdulrahim Alkadi, 2004. "The performance of subsidized urban and rural public bus operators: Empirical evidence from Norway," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 38(3), pages 413-431, September.
    • Handle: RePEc:spr:anresc:v:38:y:2004:i:3:p:413-431
    DOI: 10.1007/s00168-003-0152-y
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    Citations

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    Cited by:

    1. Veeneman, Wijnand & Wilschut, Janneke & Urlings, Thijs & Blank, Jos & van de Velde, Didier, 2014. "Efficient frontier analysis of Dutch public transport tendering: A first analysis," Research in Transportation Economics, Elsevier, vol. 48(C), pages 101-108.
    2. Simona Bigerna & Paolo Polinori, 2010. "Ambiente operativo ed efficienza nel settore del trasporto pubblico locale in Italia," SCIENZE REGIONALI, FrancoAngeli Editore, vol. 2010(3), pages 85-118.
    3. Cinzia Daraio & Marco Diana & Flavia Di Costa & Claudio Leporelli & Giorgio Matteucci & Alberto Nastasi, 2014. "Efficiency and effectiveness in the urban public transport sector: a critical review with directions for future research," DIAG Technical Reports 2014-14, Department of Computer, Control and Management Engineering, Universita' degli Studi di Roma "La Sapienza".
    4. Maria Nieswand & Matthias Walter, 2010. "Cost Efficiency and Subsidization in German Local Public Bus Transit," Discussion Papers of DIW Berlin 1071, DIW Berlin, German Institute for Economic Research.
    5. Rhys Andrews & George A. Boyne & Jennifer Law & Richard M. Walker, 2012. "Strategic Management and Public Service Performance," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-34943-8.
    6. Chen Yan & Qiong Tong, 2021. "Analysis of the Evolutionary Game between the Government and Urban Rail Transit Enterprises under the Loss-Subsidy Mode: A Case Study of Beijing," Sustainability, MDPI, vol. 13(14), pages 1-21, July.
    7. Rhys Andrews, 2007. "Civic Culture and Public Service Failure: An Empirical Exploration," Urban Studies, Urban Studies Journal Limited, vol. 44(4), pages 845-863, April.
    8. Anand Venkatesh & Shivam Kushwaha, 2017. "Measuring technical efficiency of passenger bus companies in India: a non-radial data envelopment analysis approach," OPSEARCH, Springer;Operational Research Society of India, vol. 54(4), pages 706-723, December.
    9. Mathisen, Terje Andreas & Solvoll, Gisle, 2008. "Competitive tendering and structural changes: An example from the bus industry," Transport Policy, Elsevier, vol. 15(1), pages 1-11, January.
    10. Giannis Karagiannis, 2015. "On structural and average technical efficiency," Journal of Productivity Analysis, Springer, vol. 43(3), pages 259-267, June.

    More about this item

    Keywords

    R41; H40;

    JEL classification:

    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • H40 - Public Economics - - Publicly Provided Goods - - - General

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