Port privatization, efficiency and competitiveness: Some empirical evidence from container ports (terminals)

By J. Tongzon, Wu Heng. 2005

636 citations recorded by the source corpus.

Few studies have investigated the quantitative relationship between port ownership structure and port efficiency with mixed results. This study applies a stochastic frontier model proposed by Battese and Coelli [Battese, G.E., Coelli, T.J., 1995. A model for technique inefficiency effects in a stochastic frontier production function for panel data. Empirical Economics 20, 325-332], which incorporates the inefficiency effect, to show whether port privatization is a necessary strategy for ports to gain a competitive advantage. While this stochastic frontier model has been used to a wide number of industries where the technical inefficiency effect is required, this method has rarely been employed to port industry. This study also investigates the determinants of port competitiveness. Both the principal component analysis (PCA) and the linear regression model are used to examine the effects of identified key factors on port competitiveness. Based on a sample of selected container terminals around the world, the results of this study have shown that private sector participation in the port industry to some extent can improve port operation efficiency, which will in turn increase port competitiveness. Another important determinant of port competitiveness is the adaptability to the customers' demand. All these results provide some policy implications and guidance for port authorities and port operators in formulating effective strategies to improve their competitiveness vis-a-vis rivals.

Subfields: Economics and Econometrics, Industrial and Manufacturing Engineering, Management Science and Operations Research

View Paper: https://www.semanticscholar.org/paper/c02ceba55e28992989943d75a2096d20e2f03eee

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Citations in the corpus

Environmental efficiency of ports: a Data Envelopment Analysis approach (2013, background): “…shows that inefficiency is often caused by size effect (Song and Gray 2002, 743–762; Cullinane and Song 2006, 85–115; Cullinane) and port governance structure even though the governance structure shows mixed conclusion (Cullinane, Ji, and Wang 2005, 433–462; Tongzon and Heng 2005, 405–424).”
Trajectories of efficiency measurement: A bibliometric analysis of DEA and SFA (2015, background): “…and Zi (1998) 59 3.93 12 15 Banker and Thrall (1992) 188 8.95 13 13 Reinhard et al. (2000) 58 4.46 13 14 Charnes et al. (1989) 165 6.88 14 18 Hjalmarsson et al. (1996) 57 3.35 14 19 Tone (2001) 161 13.42 15 7 Tongzon and Heng (2005) 56 7.00 15 8 Banker and Morey (1986) 160 5.93 16 19 Pels el al.”
Efficiency Measurement in the Port Industry: A Survey of the Empirical Evidence (2009, background): “For example, Tongzon (2001) attempts to measure the efficiency of port services in a broad sense, including the handling of merchandise, even though since it lacks data on the workers involved in this operation, it uses the workers of the port authorities that do not participate in cargo handling as”
The European Port Industry: An Analysis of its Economic Efficiency (2007, background): “These include Notteboom et al., 2000; Cullinane et al., 2002; Cullinane et al.,2003; Cullinane et al.,2004 and 2006; Rodríguez Álvarez et al. 2005; Wang and Cullinane, 2006 and Tongzon and Heng, 2006.”