Testing for Economies of Scope in European Railways: An Efficiency Analysis

By C. Growitsch, Heike Wetzel. Journal of Transport Economics and Policy, 2009

180 citations recorded by the source corpus.

In this paper, we conduct a pan-European efficiency analysis to investigate the performance of European railways with a particular focus on economies of vertical integration. We test the hypothesis that integrated railways realise economies of scope and, thus, produce railway services with a higher level of efficiency. To determine whether joint or separate production is more efficient, we apply a data envelopment analysis super-efficiency bootstrapping model which relates the efficiency for integrated production to a reference set consisting of separated firms which use a different production technology. We find that for a majority of European railways, economies of scope exist.

Subfields: Industrial and Manufacturing Engineering, Management Science and Operations Research, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/cba2396a3c64f03b30364a6521e647c488a2085d