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Ownership, Contractual Practices and Technical Efficiency: The Case of Urban Public Transport in France

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Author Info
William Roy () (LET - Laboratoire d'économie des transports - CNRS : UMR5593 - Université Lumière - Lyon II - Ecole Nationale des Travaux Publics de l'Etat)
Anne Yvrande-Billon (ATOM - Analyse Théorique des Organisations et des Marchés - Université Panthéon-Sorbonne - Paris I, CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I)
Abstract

This paper investigates the impact of ownership structure and contractual choices on technical efficiency in the French urban public transport sector. The central proposition, which relies on classical contract theory arguments, is that ownership regime and contractual practices are key determinants of performances.To test this proposition, we use an original panel data set covering 135 different French urban transport networks over the period 1995-2002 and we apply a stochastic frontier methodology.The econometric results corroborate our proposition: the technical efficiency of urban public transport operators depends on the ownership regime and on the type of contract governing their transactions.

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Paper provided by HAL in its series Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) with number halshs-00107375_v1.

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Date of creation: May 2007
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Publication status: Published, Journal of Transport Economics and Policy, 2007, 41, 2, 257-282
Handle: RePEc:hal:cesptp:halshs-00107375_v1

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Keywords: Contracts ; Contractual Incentives ; Contractual arrangements ; Ownership ; Efficiency ; Performance ; Urban Public Transport ; Public Service Governance;

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  1. Hart, Oliver & Shleifer, Andrei & Vishny, Robert W, 1997. "The Proper Scope of Government: Theory and an Application to Prisons," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1127-61, November.
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  2. 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. [Downloadable!] (restricted)
  3. Tirole, Jean, 1994. "The Internal Organization of Government," Oxford Economic Papers, Oxford University Press, vol. 46(1), pages 1-29, January. [Downloadable!] (restricted)
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  4. Bajari, Patrick & Tadelis, Steven, 2001. "Incentives versus Transaction Costs: A Theory of Procurement Contracts," RAND Journal of Economics, The RAND Corporation, vol. 32(3), pages 387-407, Autumn.
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  5. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-32.
  6. Schmidt, Klaus M., 1996. "Incomplete contracts and privatization," European Economic Review, Elsevier, vol. 40(3-5), pages 569-579, April. [Downloadable!] (restricted)
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  7. Philippe Gagnepain & Marc Ivaldi, 2002. "Incentive Regulatory Policies: The Case of Public Transit Systems in France," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 605-629, Winter.
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  8. William L. Megginson & Jeffry M. Netter, 2001. "From State to Market: A Survey of Empirical Studies on Privatization," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 321-389, June. [Downloadable!] (restricted)
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