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Economies of scale and cost efficiency in the postal services: empirical evidence from Switzerland

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  • Massimo Filippini
  • Marika Zola

Abstract

This paper investigates the scale and cost efficiency of the Swiss Post using an econometric approach. Our empirical analysis considers a sample of postal offices operating in the Italian-speaking part of Switzerland. The paper considers estimation of a log-log cost function employing a data set for the year 2001 with information on 47 small local post offices. The empirical evidence indicates the existence of economies of scale. Further, the outcome of this analysis shows that approximately 50% of the postal offices operate close to the regional standard for efficiency.

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  • Massimo Filippini & Marika Zola, 2005. "Economies of scale and cost efficiency in the postal services: empirical evidence from Switzerland," Applied Economics Letters, Taylor & Francis Journals, vol. 12(7), pages 437-441.
  • Handle: RePEc:taf:apeclt:v:12:y:2005:i:7:p:437-441
    DOI: 10.1080/13504850500109709
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    References listed on IDEAS

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    1. Massimo Filippini, 1998. "Are Municipal Electricity Distribution Utilities Natural Monopolies?," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 69(2), pages 157-174, June.
    2. Mehdi Farsi & Massimo Filippini, 2004. "Regulation and Measuring Cost-Efficiency with Panel Data Models: Application to Electricity Distribution Utilities," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 25(1), pages 1-19, August.
    3. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
    4. Mizutani, Fumitoshi & Uranishi, Shuji, 2003. "The Post Office vs. Parcel Delivery Companies: Competition Effects on Costs and Productivity," Journal of Regulatory Economics, Springer, vol. 23(3), pages 299-319, May.
    5. Chambers,Robert G., 1988. "Applied Production Analysis," Cambridge Books, Cambridge University Press, number 9780521314275.
    6. Cornes,Richard, 1992. "Duality and Modern Economics," Cambridge Books, Cambridge University Press, number 9780521336017.
    7. Battese, George E., 1992. "Frontier production functions and technical efficiency: a survey of empirical applications in agricultural economics," Agricultural Economics, Blackwell, vol. 7(3-4), pages 185-208, October.
    8. Battese, George E., 1992. "Frontier production functions and technical efficiency: a survey of empirical applications in agricultural economics," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 7(3-4), October.
    9. 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.
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    Cited by:

    1. Cho, Seong-Hoon & Kim, Taeyoung & Larson, Eric R. & Armsworth, Paul R., 2014. "Economies of Scale in Costs of Land Acquisition for Nature Conservation," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 177182, Agricultural and Applied Economics Association.
    2. Predrag Ralević & Momčilo Dobrodolac & Dejan Marković, 2016. "Using a nonparametric technique to measure the cost efficiency of postal delivery branches," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 24(3), pages 637-657, September.
    3. Cho, Seong-Hoon & Kim, Taeyoung & Larson, Eric R. & Armsworth, Paul R., 2017. "Economies of scale in forestland acquisition costs for nature conservation," Forest Policy and Economics, Elsevier, vol. 75(C), pages 73-82.
    4. Christian Jaag & Martin Koller & Urs Trinkner, 2009. "Calculating the Cost of the Universal Service Obligation: The Need for a Global Approach," Chapters,in: Progress in the Competitive Agenda in the Postal and Delivery Sector, chapter 8 Edward Elgar Publishing.
    5. Tochkov, Kiril, 2015. "The efficiency of postal services in the age of market liberalization and the internet: Evidence from Central and Eastern Europe," Utilities Policy, Elsevier, vol. 36(C), pages 35-42.
    6. Massimo Filippini & Martin Koller, 2012. "Cost Efficiency Measurement in Postal Delivery Networks," Quaderni della facoltà di Scienze economiche dell'Università di Lugano 1206, USI Università della Svizzera italiana.
    7. Massimo Filippini & Martin Koller & Urs Trinkner, 2010. "Do opening hours and unobserved heterogeneity affect economies of scale and scope in postal outlets?," Quaderni della facoltà di Scienze economiche dell'Università di Lugano 1007, USI Università della Svizzera italiana.

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