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Some Determinants of Cost Efficiency in German Public Transport

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  • Matthias Walter

Abstract

This paper evaluates cost efficiency and some of its managerial determinants in Germany's local public transport. A heteroscedastic stochastic frontier approach reveals that a high degree of tramcar utilisation and a high outsourcing degree influence the efficiency predictions positively. Mean efficiencies lie between 0.849 and 0.952, depending on the applied panel data models accounting for unobserved heterogeneity and observed heterogeneous output variables for tram, light railway, and metro services. The inefficiency levels correspond to a savings potential of between € 1.40 and 4.43 billion based on the € 28.23 billion total costs (in 2006 prices) for 254 observations of thirty-nine companies, 1997-2006. © 2011 LSE and the University of Bath

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  • Matthias Walter, 2011. "Some Determinants of Cost Efficiency in German Public Transport," Journal of Transport Economics and Policy, University of Bath, vol. 45(1), pages 1-20, January.
    • Handle: RePEc:tpe:jtecpo:v:45:y:2011:i:1:p:1-20
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    Cited by:

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    3. Filippini, M. & Koller, M. & Masiero, G., 2015. "Competitive tendering versus performance-based negotiation in Swiss public transport," Transportation Research Part A: Policy and Practice, Elsevier, vol. 82(C), pages 158-168.
    4. Maria Nieswand & Matthias Walter, 2010. "Cost Efficiency and Subsidization in German Local Public Bus Transit," Discussion Papers of DIW Berlin 1071, DIW Berlin, German Institute for Economic Research.
    5. de Grange, Louis & Troncoso, Rodrigo & Briones, Ignacio, 2018. "Cost, production and efficiency in local bus industry: An empirical analysis for the bus system of Santiago," Transportation Research Part A: Policy and Practice, Elsevier, vol. 108(C), pages 1-11.
    6. Mihir Dash, 2020. "Firm-Level Determinants of Cost Structure of the Indian Sugar Industry," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 9(2), pages 55-62, June.
    7. Fredrik Andersson & Henrik Jordahl & Jens Josephson, 2019. "Outsourcing Public Services: Contractibility, Cost, and Quality," CESifo Economic Studies, CESifo Group, vol. 65(4), pages 349-372.
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    9. Vigren, Andreas, 2016. "Cost efficiency in Swedish public transport," Research in Transportation Economics, Elsevier, vol. 59(C), pages 123-132.
    10. Wolański, Michał, 2011. "Estimation of losses due to the existence of monopolies in urban bus transport in Poland," MPRA Paper 38525, University Library of Munich, Germany.

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