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Efficiency analysis of major cruise lines

Author

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  • Chang, Young-Tae
  • Lee, Suhyung
  • Park, Hyosoo (Kevin)

Abstract

Three major cruise lines account for 82% of the total market share. Their financial statements show different results between the operating incomes and net incomes over time. To examine the major causes of the differences, this study measured the efficiency of the top three cruise lines to develop a network DEA model to analyze the cruise operations at two stages, namely operating and non-operating stages. In addition, the determinants of the efficiencies were examined using a bootstrapped-truncated regression model. Overall, cruise lines were efficient at the operating stage, but varied widely in the efficiency of the non-operating stage. Cruise lines attempting high capacity expansion were relatively inefficient because of the heavy interest payments arising from the high debt-to-capital ratio. Moreover, the neglected hedging policy regarding the financial risks also contributed to the inefficiency.

Suggested Citation

  • Chang, Young-Tae & Lee, Suhyung & Park, Hyosoo (Kevin), 2017. "Efficiency analysis of major cruise lines," Tourism Management, Elsevier, vol. 58(C), pages 78-88.
    • Handle: RePEc:eee:touman:v:58:y:2017:i:c:p:78-88
    DOI: 10.1016/j.tourman.2016.10.012
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    5. Manuel Salas-Velasco, 2020. "Measuring and explaining the production efficiency of Spanish universities using a non-parametric approach and a bootstrapped-truncated regression," Scientometrics, Springer;Akadémiai Kiadó, vol. 122(2), pages 825-846, February.
    6. Manuel Angel Fernández Gámez & Jose Ramón Sánchez Serrano & Angela Callejón Gil & Ana José Cisneros Ruiz, 2019. "Cruise Passengers’ Intention and Sustainable Management of Cruise Destinations," Sustainability, MDPI, vol. 11(7), pages 1-14, April.
    7. Laurent Botti & Sylvain Petit & Linjia Zhang, 2020. "Strategic decision concerning tourist origins portfolio: A decision process based on the ELECTRE method and applied to French Polynesia," Tourism Economics, , vol. 26(5), pages 830-843, August.
    8. Joohwan Kim & Hwayoung Kim, 2021. "Evaluation of the Efficiency of Maritime Transport Using a Network Slacks-Based Measure (SBM) Approach: A Case Study on the Korean Coastal Ferry Market," Sustainability, MDPI, vol. 13(11), pages 1-17, May.
    9. Wen‐Min Lu & Qian Long Kweh & Dong‐Sing He & Jui‐Min Shih, 2017. "Performance analysis of the cultural and creative industry: a network‐based approach," Naval Research Logistics (NRL), John Wiley & Sons, vol. 64(8), pages 662-676, December.
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