IDEAS home Printed from https://ideas.repec.org/p/ags/ndtr09/207604.html
   My bibliography  Save this paper

Ownership Forms Matter for Airport Efficiency: A Stochastic Frontier Investigation of Worldwide Airports

Author

Listed:
  • Oum, Tae H.
  • Yan, Jia
  • Yu, Chunyan

Abstract

We study the effects of ownership forms on airports’ cost efficiency by applying stochastic frontier analysis to a panel data of the world’s major airports. Our key findings are: (a) Countries considering privatization of airports should transfer majority shares to the private sector; (b) Mixed ownership of airport with a government majority should be avoided in favor of even 100% government owned public firm; (c) U.S. airports operated by port authorities should consider to transfer ownership/management to independent airport authorities; and (d) Privatization of one or more airports in cities with multiple airports would improve the efficiency of all airports.

Suggested Citation

  • Oum, Tae H. & Yan, Jia & Yu, Chunyan, 2009. "Ownership Forms Matter for Airport Efficiency: A Stochastic Frontier Investigation of Worldwide Airports," 50th Annual Transportation Research Forum, Portland, Oregon, March 16-18, 2009 207604, Transportation Research Forum.
  • Handle: RePEc:ags:ndtr09:207604
    as

    Download full text from publisher

    File URL: http://ageconsearch.umn.edu/record/207604/files/2009_31_OwnershipForms_paper.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Michael Scheidler & Reinhard Hujer & Joachim Grammig, 2005. "Discrete choice modelling in airline network management," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(4), pages 467-486.
    2. McCausland, William J., 2008. "On Bayesian analysis and computation for functions with monotonicity and curvature restrictions," Journal of Econometrics, Elsevier, vol. 142(1), pages 484-507, January.
    3. Pels, Eric & Nijkamp, Peter & Rietveld, Piet, 2003. "Inefficiencies and scale economies of European airport operations," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 39(5), pages 341-361, September.
    4. Cohen, Jeffrey P. & Morrison Paul, Catherine J., 2003. "Airport infrastructure spillovers in a network system," Journal of Urban Economics, Elsevier, vol. 54(3), pages 459-473, November.
    5. O'Donnell, Christopher J. & Coelli, Timothy J., 2005. "A Bayesian approach to imposing curvature on distance functions," Journal of Econometrics, Elsevier, vol. 126(2), pages 493-523, June.
    6. Levy, Brian, 1987. "A theory of public enterprise behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 8(1), pages 75-96, March.
    7. Bos, Dieter, 1991. "Privatization: A Theoretical Treatment," OUP Catalogue, Oxford University Press, number 9780198283690.
    8. Boardman, Anthony E & Vining, Aidan R, 1989. "Ownership and Performance in Competitive Environments: A Comparison of the Performance of Private, Mixed, and State-Owned Enterprises," Journal of Law and Economics, University of Chicago Press, vol. 32(1), pages 1-33, April.
    9. Gillen, David & Lall, Ashish, 1997. "Developing measures of airport productivity and performance: an application of data envelopment analysis," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 33(4), pages 261-273, December.
    10. Kumbhakar, Subal C. & Tsionas, Efthymios G., 2005. "Measuring technical and allocative inefficiency in the translog cost system: a Bayesian approach," Journal of Econometrics, Elsevier, vol. 126(2), pages 355-384, June.
    11. Lyon, David & Francis, Graham, 2006. "Managing New Zealand's airports in the face of commercial challenges," Journal of Air Transport Management, Elsevier, vol. 12(5), pages 220-226.
    12. Scott Atkinson & Jeffrey Dorfman, 2005. "Multiple Comparisons with the Best: Bayesian Precision Measures of Efficiency Rankings," Journal of Productivity Analysis, Springer, vol. 23(3), pages 359-382, July.
    13. William Barnett & Meenakshi Pasupathy, 2003. "Regularity of the Generalized Quadratic Production Model: A Counterexample," Econometric Reviews, Taylor & Francis Journals, vol. 22(2), pages 135-154.
    14. Efthymios G. Tsionas, 2002. "Stochastic frontier models with random coefficients," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 17(2), pages 127-147.
    15. Johan Willner & David Parker, 2007. "The Performance of Public and Private Enterprise under Conditions of Active and Passive Ownership and Competition and Monopoly," Journal of Economics, Springer, vol. 90(3), pages 221-253, April.
    16. Scott E. Atkinson & Jeffrey H. Dorfman, 2009. "Feasible estimation of firm-specific allocative inefficiency through Bayesian numerical methods," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(4), pages 675-697.
    17. Tae Hoon Oum & Anming Zhang & Yimin Zhang, 2004. "Alternative Forms of Economic Regulation and their Efficiency Implications for Airports," Journal of Transport Economics and Policy, University of Bath, vol. 38(2), pages 217-246, May.
    18. John Vickers & George Yarrow, 1991. "Economic Perspectives on Privatization," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 111-132, Spring.
    19. Koop, Gary & Osiewalski, Jacek & Steel, Mark F. J., 1997. "Bayesian efficiency analysis through individual effects: Hospital cost frontiers," Journal of Econometrics, Elsevier, vol. 76(1-2), pages 77-105.
    20. Pacheco, R. R. & Fernandes, E., 2003. "Managerial efficiency of Brazilian airports," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(8), pages 667-680, October.
    21. De Alessi, Louis, 1983. "Property Rights, Transaction Costs, and X-Efficiency: An Essay in Economic Theory," American Economic Review, American Economic Association, vol. 73(1), pages 64-81, March.
    22. Fernandez, Carmen & Osiewalski, Jacek & Steel, Mark F. J., 1997. "On the use of panel data in stochastic frontier models with improper priors," Journal of Econometrics, Elsevier, vol. 79(1), pages 169-193, July.
    23. Ho-chuan Huang, 2004. "Estimation of Technical Inefficiencies with Heterogeneous Technologies," Journal of Productivity Analysis, Springer, vol. 21(3), pages 277-296, May.
    24. Halpern, Nigel & Pagliari, Romano, 2007. "Governance structures and the market orientation of airports in Europe's peripheral areas," Journal of Air Transport Management, Elsevier, vol. 13(6), pages 376-382.
    25. Danielle Lewis & Randy Anderson, 1999. "Residential Real Estate Brokerage Efficiency and the Implications of Franchising: A Bayesian Approach," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 27(3), pages 543-560.
    26. Adler, Nicole & Berechman, Joseph, 2001. "Measuring airport quality from the airlines' viewpoint: an application of data envelopment analysis," Transport Policy, Elsevier, vol. 8(3), pages 171-181, July.
    27. Oum, Tae Hoon & Yu, Chunyan, 2004. "Measuring airports' operating efficiency: a summary of the 2003 ATRS global airport benchmarking report," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 40(6), pages 515-532, November.
    28. De Fraja, Giovanni, 1993. "Productive efficiency in public and private firms," Journal of Public Economics, Elsevier, vol. 50(1), pages 15-30, January.
    29. Hooper, P.G & Hensher, D.A, 1997. "Measuring total factor productivity of airports-- an index number approach," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 33(4), pages 249-259, December.
    30. Malcolm Abbott & Su Wu, 2002. "Total Factor Productivity and Efficiency of Australian Airports," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(3), pages 244-260.
    31. Meeusen, Wim & van den Broeck, Julien, 1977. "Efficiency Estimation from Cobb-Douglas Production Functions with Composed Error," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(2), pages 435-444, June.
    32. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
    33. Diewert, Walter E & Wales, Terence J, 1987. "Flexible Functional Forms and Global Curvature Conditions," Econometrica, Econometric Society, vol. 55(1), pages 43-68, January.
    34. 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.
    35. Oum, Tae Hoon & Yu, Chunyan & Fu, Xiaowen, 2003. "A comparative analysis of productivity performance of the world's major airports: summary report of the ATRS global airport benchmarking research report—2002," Journal of Air Transport Management, Elsevier, vol. 9(5), pages 285-297.
    36. Ehrlich, Isaac & Georges Gallais-Hamonno & Zhiqiang Liu & Randall Lutter, 1994. "Productivity Growth and Firm Ownership: An Analytical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 1006-1038, October.
    37. Andrew N. Kleit & Dek Terrell, 2001. "Measuring Potential Efficiency Gains From Deregulation Of Electricity Generation: A Bayesian Approach," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 523-530, August.
    38. Flores-Fillol, Ricardo, 2009. "Airline competition and network structure," Transportation Research Part B: Methodological, Elsevier, vol. 43(10), pages 966-983, December.
    39. Juan Martín & Concepción Román, 2006. "A Benchmarking Analysis of Spanish Commercial Airports. A Comparison Between SMOP and DEA Ranking Methods," Networks and Spatial Economics, Springer, vol. 6(2), pages 111-134, June.
    Full references (including those not matched with items on IDEAS)

    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:ags:ndtr09:207604. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://www.trforum.org/journal/ .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.