Title: Revenue vs. technical efficiency in railways

Authors: Olli-Pekka Hilmola

Addresses: Kouvola Research Unit, Lappeenranta University of Technology, Prikaatintie 9, FIN-45100 Kouvola, Finland

Abstract: In most of the efficiency related studies, railways have been evaluated through technical efficiency models using data envelopment analysis (DEA). However, increasing intra- and inter-modal competition, among global emphasis on privatisation and deregulation of transportation systems forces railways to manage their revenues more carefully. This research analyses how railways globally have performed in technical and revenue efficiency with data arising from year 2004. Findings show that generally efficiencies develop in similar direction, but clear exceptions also exist (bias countries). Correlation analysis also reveals interesting finding that freight and passenger efficiency do not have connection with each other at all, and could potentially lead in the further specialisation among the actors within the medium term in this sector.

Keywords: technical efficiency; revenue efficiency; revenue management; data envelopment analysis; DEA; railways; passenger efficiency; freight efficiency.

DOI: 10.1504/IJVCM.2010.036991

International Journal of Value Chain Management, 2010 Vol.4 No.4, pp.305 - 318

Published online: 20 Nov 2010 *

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