Operational performance of low-cost carriers and international airlines: New evidence using a bootstrap truncated regression
AbstractBetween 2001 and 2005, the US airline industry faced financial turmoil. At the same time, the European airline industry entered a period of substantive deregulation. This period witnessed opportunities for low-cost carriers to become more competitive in the market as a result of these combined events. To help assess airline performance in the aftermath of these events, this paper provides new evidence of technical efficiency for 42 national and international airlines in 2006 using the data envelopment analysis (DEA) bootstrap approach first proposed by Simar and Wilson (J Econ, 136:31-64, 2007). In the first stage, technical efficiency scores are estimated using a bootstrap DEA model. In the second stage, a truncated regression is employed to quantify the economic drivers underlying measured technical efficiency. The results highlight the key role played by non-discretionary inputs in measures of airline technical efficiency.
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Bibliographic InfoPaper provided by School of Economics and Finance, Queensland University of Technology in its series School of Economics and Finance Discussion Papers and Working Papers Series with number 271.
Length: 14 pages
Date of creation: 06 Sep 2011
Date of revision:
Data envelopment analysis; efficiency; airlines; bootstrap truncated regression; non-discretionary inputs.;
Find related papers by JEL classification:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
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