IDEAS home Printed from https://ideas.repec.org/a/kap/revind/v46y2015i2p169-182.html
   My bibliography  Save this article

Public Enterprise Efficiency: The Case of the New York Canals

Author

Listed:
  • Donald Vitaliano

Abstract

A random effects stochastic frontier variable cost function is estimated for the Erie Canal and nine interconnected lateral canals in New York, covering the period 1837–1881. Variable costs are 50 % above least cost for the Erie and 42 % above across all the 10 canals. Inefficiency does not vary over time in response to numerous changes in canal administrative structures and personnel or the advent of railroads. The canal system was plagued by documented waste, fraud and mismanagement throughout its history. A privatized, price capped Erie Canal was proposed in 1817, but rejected on political grounds. Copyright Springer Science+Business Media New York 2015

Suggested Citation

  • Donald Vitaliano, 2015. "Public Enterprise Efficiency: The Case of the New York Canals," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 46(2), pages 169-182, March.
    • Handle: RePEc:kap:revind:v:46:y:2015:i:2:p:169-182
    DOI: 10.1007/s11151-014-9448-6
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s11151-014-9448-6
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11151-014-9448-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Stanley Engerman & Kenneth L. Sokoloff, 2004. "Digging the Dirt at Public Expense: Governance in the Building of the Erie Canal and Other Public Works," NBER Working Papers 10965, National Bureau of Economic Research, Inc.
    2. Vitaliano, Donald F., 2005. "Estimation of the Return on Capital in Municipal Water Systems," National Tax Journal, National Tax Association;National Tax Journal, vol. 58(4), pages 685-696, December.
    3. Greene, William, 2005. "Reconsidering heterogeneity in panel data estimators of the stochastic frontier model," Journal of Econometrics, Elsevier, vol. 126(2), pages 269-303, June.
    4. Braeutigam, Ronald R. & Daughety, Andrew F., 1983. "On the estimation of returns to scale using variable cost functions," Economics Letters, Elsevier, vol. 11(1-2), pages 25-31.
    5. Vining, Aidan R & Boardman, Anthony E, 1992. "Ownership versus Competition: Efficiency in Public Enterprise," Public Choice, Springer, vol. 73(2), pages 205-239, March.
    6. Smith, Walter B., 1963. "Wage Rates on the Erie Canal, 1828–1881," The Journal of Economic History, Cambridge University Press, vol. 23(3), pages 298-311, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ajayi, Victor & Weyman-Jones, Thomas & Glass, Anthony, 2017. "Cost efficiency and electricity market structure: A case study of OECD countries," Energy Economics, Elsevier, vol. 65(C), pages 283-291.
    2. Lundgren, Tommy & Marklund, Per-Olov & Zhang, Shanshan, 2016. "Industrial energy demand and energy efficiency – Evidence from Sweden," Resource and Energy Economics, Elsevier, vol. 43(C), pages 130-152.
    3. Raushan Bokusheva & Lukáš Čechura & Subal C. Kumbhakar, 2023. "Estimating persistent and transient technical efficiency and their determinants in the presence of heterogeneity and endogeneity," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(2), pages 450-472, June.
    4. Bozec, Richard, 2004. "L’analyse comparative de la performance entre les entreprises publiques et les entreprises privées : le problème de mesure et son impact sur les résultats," L'Actualité Economique, Société Canadienne de Science Economique, vol. 80(4), pages 619-654, Décembre.
    5. Barros, Carlos Pestana & Williams, Jonathan, 2013. "The random parameters stochastic frontier cost function and the effectiveness of public policy: Evidence from bank restructuring in Mexico," International Review of Financial Analysis, Elsevier, vol. 30(C), pages 98-108.
    6. Kui-Wai Li & Tung Liu & Lihong Yun, 2007. "Technology Progress, Efficiency, and Scale of Economy in Post-reform China," Working Papers 200701, Ball State University, Department of Economics, revised Apr 2007.
    7. Victor Moutinho & Mara Madaleno, 2021. "Assessing Eco-Efficiency in Asian and African Countries Using Stochastic Frontier Analysis," Energies, MDPI, vol. 14(4), pages 1-17, February.
    8. Chen, Yi-Yi & Schmidt, Peter & Wang, Hung-Jen, 2014. "Consistent estimation of the fixed effects stochastic frontier model," Journal of Econometrics, Elsevier, vol. 181(2), pages 65-76.
    9. repec:use:tkiwps:1818 is not listed on IDEAS
    10. Gangopadhyay, Partha & Jain, Siddharth & Bakry, Walid, 2022. "In search of a rational foundation for the massive IT boom in the Australian banking industry: Can the IT boom really drive relationship banking?," International Review of Financial Analysis, Elsevier, vol. 82(C).
    11. Banfi, Silvia & Filippini, Massimo, 2010. "Resource rent taxation and benchmarking--A new perspective for the Swiss hydropower sector," Energy Policy, Elsevier, vol. 38(5), pages 2302-2308, May.
    12. Barberis, Nicholas & Maxim Boycko & Andrei Shleifer & Natalia Tsukanova, 1996. "How Does Privatization Work? Evidence from the Russian Shops," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 764-790, August.
    13. Mehdi Farsi & Aurelio Fetz & Massimo Filippini, 2007. "Benchmarking and Regulation in the Electricity Distribution Sector," CEPE Working paper series 07-54, CEPE Center for Energy Policy and Economics, ETH Zurich.
    14. Bill Greene with Antonio Alvarez (Univ. of Oviedo) & Carlos Arias (Univ. of Leon), 2004. "Accounting For Unobservables In Production Models: Management And Inefficiency," Econometric Society 2004 Australasian Meetings 341, Econometric Society.
    15. Deng, Yaguo & Lopes Moreira Da Veiga, María Helena & Wiper, Michael Peter, 2016. "Efficiency evaluation of Spanish hotel chains," DES - Working Papers. Statistics and Econometrics. WS 23897, Universidad Carlos III de Madrid. Departamento de Estadística.
    16. Tung Liu, 2020. "Measuring Technical, Allocative inefficiency, and Cost Inefficiency by Applying Duality Theory," Working Papers 202001, Ball State University, Department of Economics, revised Jun 2020.
    17. Thanh‐Tung Nguyen & Trung Thanh Nguyen & Ulrike Grote, 2023. "Internet use and agricultural productivity in rural Vietnam," Review of Development Economics, Wiley Blackwell, vol. 27(3), pages 1309-1326, August.
    18. repec:use:tkiwps:3232 is not listed on IDEAS
    19. Sabrina Auci & Laura Castellucci & Manuela Coromaldi, 2021. "How does public spending affect technical efficiency? Some evidence from 15 European countries," Bulletin of Economic Research, Wiley Blackwell, vol. 73(1), pages 108-130, January.
    20. Baños-Pino, José F. & Boto-García, David & Zapico, Emma, 2021. "Persistence and dynamics in the efficiency of toll motorways: The Spanish case," Efficiency Series Papers 2021/03, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    21. Megginson, William Leon, 2005. "The Financial Economics of Privatization," OUP Catalogue, Oxford University Press, number 9780195150629.
    22. Li, Larry & McMurray, Adela & Sy, Malick & Xue, Jinjun, 2018. "Corporate ownership, efficiency and performance under state capitalism: Evidence from China," Journal of Policy Modeling, Elsevier, vol. 40(4), pages 747-766.

    More about this item

    Keywords

    Cost efficiency; Erie canal; Public enterprise; R5; D24; N7; C1; H110; H4;
    All these keywords.

    JEL classification:

    • R5 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • N7 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • H4 - Public Economics - - Publicly Provided Goods

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:revind:v:46:y:2015:i:2:p:169-182. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.