The role of external factors versus managerial ability in determining seaports’ relative efficiency: An input-by-input analysis through a multi-step approach on a panel of Southern European ports

This article provides an analysis of the performance of a panel of Southern European ports. In contrast with previous research, a multi-step approach is followed. This methodology allows distinguishing between the role of both factors that are external and internal to the organisation of the port in determining the relative ranking of ports in terms of efficiency. Furthermore, it enables the identification of the impact on an input-by-input basis. Managerial capacities, port infrastructure endowment and services are tested together with port policies, macroeconomic conditions and other external factors to verify their individual impact. In the first stage, efficiency is measured via the traditional input-oriented Data Envelopment Analysis (DEA). In the second stage a stochastic frontier analysis in carried out through fixed-effect estimators in order to identify the determinants of input-specific efficiency differentials across ports. In general, governance-related factors and macroeconomic conditions predominate the managerial skills for the more flexible factors of production. The outcome of the DEA applied in the third stage shows that netting inputs of the impact of factors considered outside direct port managers’ control, relative to performances, change significantly. This is particularly true for multi-functional ports.