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Motivating air navigation service provider performance

Author

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  • Nicole Adler
  • Eef Delhaye
  • Adit Kivel
  • Stef Proost

Abstract

The ownership form of Air Navigation Service Providers varies across countries ranging from state agencies belonging to the Department of Transport, to government-owned corporations, to semi-private firms with for-profit or not-for-profit mandates. This research focusses on the link between the performance of ANSPs and their ownership form. A theoretical economic model suggests that effort to achieve cost efficiency will be higher in the case of public companies with a board of stakeholders composed of airspace users and in the case of private companies in which stakeholders are also shareholders. A stochastic frontier analysis estimation of the production and cost functions of 37 European air navigation service providers over nine years suggests that the public-private ownership form achieves statistically significantly higher cost and productive efficiency levels compared to either a government corporation or a state agency.

Suggested Citation

  • Nicole Adler & Eef Delhaye & Adit Kivel & Stef Proost, 2017. "Motivating air navigation service provider performance," Working Papers of Department of Economics, Leuven 601932, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
  • Handle: RePEc:ete:ceswps:601932
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