Cost Efficiency Measurement in Postal Delivery Networks
AbstractThe purpose of this study is to analyze the level of cost efficiency of Swiss Post's postal delivery units to enable policy makers' as well as Swiss Post to decide on the reactions to market changes. In particular, we use different panel data models to assess cost efficiency in these units to account for unobserved heterogeneity. The results from applying Mundlak's formulation to the Pooled stochastic frontier model provides evidence that this model is not affected by a heterogeneity bias and that the cost efficiency values lie within a lower and upper bound of the other recent and standard econometric frontier models. Overall, the analysis shows that assumptions on unobserved heterogeneity are crucial and that results of econometric cost efficiency measurement models have to be interpreted with corresponding caution.
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Bibliographic InfoPaper provided by USI Università della Svizzera italiana in its series Quaderni della facoltà di Scienze economiche dell'Università di Lugano with number 1206.
Length: 25 pages
Date of creation: Sep 2012
Date of revision:
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Web page: http://www.library.lu.usi.ch
cost efficiency; stochastic frontier models; unobserved heterogeneity; Mundlak; postal delivery network;
Find related papers by JEL classification:
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Longitudinal Data; Spatial Time Series
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
- L87 - Industrial Organization - - Industry Studies: Services - - - Postal and Delivery Services
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-10-06 (All new papers)
- NEP-EFF-2012-10-06 (Efficiency & Productivity)
- NEP-NET-2012-10-06 (Network Economics)
- NEP-REG-2012-10-06 (Regulation)
- NEP-URE-2012-10-06 (Urban & Real Estate Economics)
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