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Have Asian airlines caught up with European Airlines? A by-production efficiency analysis
[Analyse comparée de l’Eco-performance des compagnies aériennes asiatiques et européennes]

Author

Listed:
  • Amir Arjomandi

    (School of Accounting, Economics and Finance [Wollongong] - Faculty of Business [Wollongong] - University of Wollongong [Australia])

  • K Hervé Dakpo

    (ECO-PUB - Economie Publique - INRA - Institut National de la Recherche Agronomique - AgroParisTech)

  • Juergen Heinz Seufert

    (University of Nottingham Ningbo [China])

Abstract

This paper extends previous approaches to meta-efficiency measures by incorporating meta-frontiers using good-output, bad-output and by-production efficiencies to compare European and Asian airlines. We also examine whether the heterogeneity in environmental regulatory standards between these regions has emboldened Asian airlines to be less eco-friendly and/or more market-share seeking. We find that the environmental performance of European airlines improved continuously between 2007 and 2013, unlike their competitors in Asia. We argue that this improvement in the environmental performance of the European airlines could be an outcome of the European Emission Trading Scheme (ETS), which set incentives for European airlines to renew their fleets and optimise their operations. Our technological gap ratio estimates also point to some Asian airlines outperforming all other airlines on technological measures, indicating they operate in a more favourable business environment. Overall, our method contributes to the methodological enhancement of data envelopment analysis (DEA) and allows deeper insights into firm operations in general, and environmental efficiency analysis of European and Asian airlines in particular.

Suggested Citation

  • Amir Arjomandi & K Hervé Dakpo & Juergen Heinz Seufert, 2018. "Have Asian airlines caught up with European Airlines? A by-production efficiency analysis [Analyse comparée de l’Eco-performance des compagnies aériennes asiatiques et européennes]," Post-Print hal-02628232, HAL.
    • Handle: RePEc:hal:journl:hal-02628232
    DOI: 10.1016/j.tra.2018.06.031
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    Cited by:

    1. Aralbayeva Shadiyar & Hyun-Jeong Ban & Hak-Seon Kim, 2020. "Extracting Key Drivers of Air Passenger’s Experience and Satisfaction through Online Review Analysis," Sustainability, MDPI, vol. 12(21), pages 1-20, November.
    2. Aparicio, Juan & Kapelko, Magdalena & Zofío, José L., 2020. "The measurement of environmental economic inefficiency with pollution-generating technologies," Resource and Energy Economics, Elsevier, vol. 62(C).
    3. Wang, Miao & Feng, Chao, 2021. "The consequences of industrial restructuring, regional balanced development, and market-oriented reform for China's carbon dioxide emissions: A multi-tier meta-frontier DEA-based decomposition analysi," Technological Forecasting and Social Change, Elsevier, vol. 164(C).
    4. Li, Ye & Zheng, Jin-kun & Luo, Xi-xi & Cui, Qiang, 2025. "Airline energy efficiency measurement considering heterogeneity," Journal of Air Transport Management, Elsevier, vol. 127(C).
    5. Mohd Hasan Wong, Fadhli Wong & Al Kez, Dlzar & Del Rio, Dylan Furszyfer & Foley, Aoife & Rooney, David & Abai, Mahpuzah, 2024. "Decarbonizing and offsetting emissions in the airline industry: Current perspectives and strategies," Energy, Elsevier, vol. 313(C).
    6. Losa, Eduardo Tola & Arjomandi, Amir & Hervé Dakpo, K. & Bloomfield, Jason, 2020. "Efficiency comparison of airline groups in Annex 1 and non-Annex 1 countries: A dynamic network DEA approach," Transport Policy, Elsevier, vol. 99(C), pages 163-174.
    7. Huang, Fei & Zhou, Dequn & Hu, Jin-Li & Wang, Qunwei, 2020. "Integrated airline productivity performance evaluation with CO2 emissions and flight delays," Journal of Air Transport Management, Elsevier, vol. 84(C).
    8. Wang, Derek D. & Hu, Peng & Ren, Yaoyao, 2025. "The by-production models for benchmarking," Energy Economics, Elsevier, vol. 143(C).
    9. See, Kok Fong & Abdul Rashid, Azwan & Yu, Ming-Miin, 2024. "Incorporating CO2 emissions and capacity utilization in the airline inefficiency analysis: A two-stage multiproduct network technology with a nonconvex metafrontier framework," Journal of Air Transport Management, Elsevier, vol. 120(C).
    10. Ying Li & Tai‐Yu Lin & Yung‐ho Chiu & Shu‐Ning Lin & Tzu‐Han Chang, 2021. "Impact of alliances and delay rate on airline performance," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(6), pages 1607-1618, September.
    11. Liu, Dan & Zhang, Jiahuang & Yu, Ming-Miin, 2023. "Decomposing airline profit inefficiency in NDEA through the non-competitive Nerlovian profit inefficiency model," Journal of Air Transport Management, Elsevier, vol. 107(C).
    12. Yu, Ming-Miin & Rakshit, Ipsita, 2024. "How to establish input and output targets for airlines with heterogeneous production technologies: A nash bargaining DEA approach within the meta-frontier framework," Journal of Air Transport Management, Elsevier, vol. 116(C).
    13. Kotcharin, Suntichai & Maneenop, Sakkakom & Jaroenjitrkam, Anutchanat, 2023. "The impact of government policy responses on airline stock return during the COVID-19 crisis," Research in Transportation Economics, Elsevier, vol. 99(C).
    14. Haddad, M. & Sanders, D. & Tewkesbury, G., 2020. "Selecting a discrete multiple criteria decision making method for Boeing to rank four global market regions," Transportation Research Part A: Policy and Practice, Elsevier, vol. 134(C), pages 1-15.
    15. Fang-Chen Kao & Irene Wei Kiong Ting & Han-Chung Chou & Yi-Sung Liu, 2022. "Exploring the Influence of Corporate Social Responsibility on Efficiency: An Extended Dynamic Data Envelopment Analysis of the Global Airline Industry," Sustainability, MDPI, vol. 14(19), pages 1-21, October.
    16. See, Kok Fong & Rashid, Azwan Abdul & Yu, Ming-Miin, 2024. "Measuring the network capacity utilization, energy consumption and environmental inefficiency of global airlines," Energy Economics, Elsevier, vol. 132(C).
    17. Tanrıverdi, Gökhan & Merkert, Rico & Karamaşa, Çağlar & Asker, Veysi, 2023. "Using multi-criteria performance measurement models to evaluate the financial, operational and environmental sustainability of airlines," Journal of Air Transport Management, Elsevier, vol. 112(C).
    18. Yu, Ming-Miin & Rakshit, Ipsita, 2023. "Target setting for airlines incorporating CO2 emissions: The DEA bargaining approach," Journal of Air Transport Management, Elsevier, vol. 108(C).
    19. Finn R. Førsund, 2021. "Performance measurement and joint production of intended and unintended outputs," Journal of Productivity Analysis, Springer, vol. 55(3), pages 157-175, June.
    20. Nguyen, Minh-Anh Thi & Yu, Ming-Miin & Lirn, Taih-Cherng, 2022. "Revenue efficiency across airline business models: A bootstrap non-convex meta-frontier approach," Transport Policy, Elsevier, vol. 117(C), pages 108-117.

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    Keywords

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    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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