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Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Journal of Air Transport Management, Volume 29, June 2013, Pages 11–16
In the last decade, the use of public service obligations (PSO; regulation and/or subsidies) in air transport to European remoter regions has substantially increased. However, there is significant heterogeneity between different regions in Europe with respect to the provision of PSO operations which makes benchmarking of European PSO airlines and learning from best practices a worthwhile activity. Particularly during the current times of government austerity it is interesting to understand, whether individual PSO operators are efficiently run. As most of these services are supposed to be vital for the social and economic development of the relevant regions, it is decisive to examine factors (other than cease operation) that could improve this efficiency. This paper applies a two-stage DEA approach to measure the efficiency of 18 European PSO airlines over two fiscal years. We then use truncated regressions to determine the impact of specific details of the airlines and their 206 PSO contracts on efficiency. Our results suggest that ownership has no impact on the airlines efficiency. By contrast, the number of remaining months (before a PSO is due for renewal) on these contracts has a very significant positive and the average stage length a negative impact on the efficiency of the associated airlines.
Many European countries are committed to subsidised Public Service Obligation (PSO) air services for their remote regions (typically to peripheral areas such as the Hebrides, Orkney and Shetland Islands in Scotland). Member States may impose PSOs on routes to these remoter regions, if they feel that air services are vital for the economic and/or social development of these regions and that without subsidies and/or regulatory measures to protect them no scheduled air service to these regions could be maintained. Although the member states must respect the conditions and requirements set out in Article 16 of the Air Services Regulation 1008/2008, the interpretation of the “air service adequacy” depends on the judgement of the Public Transport Authority imposing the PSO. As a consequence there is substantial heterogeneity and imbalance between different regions across Europe (EU) in terms of the provision of PSO operations (see for example, Williams and Pagliari, 2004). For example, on the thin routes serving the Shetland Islands in Scotland PSO operators use rather small aircraft to provide the vital air services to the remoter communities in these regions. In contrast in France, many PSO routes are served by big aircraft such as A320 or even Boeing 777-300ER because these routes have high traffic in the summer months. Since these routes are often also competing with well-developed ground transport, previous research has extensively focused on whether some of these PSO routes are legitimate or rather a product of market protectionism and government/lobby group intervention (e.g., Bahuand, 2010). However, there is also literature on the benefits of PSO air transport. Gordijn and van de Coevering (2006) highlight, for example, the social and economic advantages of PSOs in Europe and identify a large number of European regional airports that would benefit from these publicly supported air services. We believe that PSOs are often sensible and necessary (as are similar schemes in Australia, Canada, India and the U.S.), because otherwise individuals or businesses would become (at least during certain periods of the year) more or indeed totally isolated and some regions severely disadvantaged in terms of their economic development. These PSO air services should be, however, still efficiently run. It is hence interesting to see whether determinants such as the market access to the relevant routes, type of operator, contract characteristics and ownership have an impact on the efficiency of the PSO operators. If one considers, that on some European PSO routes such as Paris to Bastia, low cost carriers are very keen on operating competing services on a commercial basis on these routes it becomes interesting to examine how efficient the airlines that operate EU PSO routes are (other studies such as Merkert and Cowie, 2012, have shown that EU airlines have generally improved their efficiency over the last decade, however no empirical evidence on PSO airlines exists). At this point it is worth mentioning that PSO operators in Europe usually undertake in addition to PSO operations also commercial services. This paper analyses the overall efficiency of these operators and therefore covers both, PSO and commercial services. The structure of this paper is as follows. Section 2 provides a brief review of the previous literature on the efficiency of PSO operations in Europe. Section 3 describes the methodology and data of the two-stage technical efficiency Data Envelopment Analysis (DEA) that we apply to European PSO operators. Section 4 presents and discusses the results, whilst Section 5 summarises the findings of the paper and offers final conclusions as well as recommendations for further research.
نتیجه گیری انگلیسی
This paper has applied a two-stage bootstrapped DEA approach to evaluate technical efficiency and scale efficiency for 18 European PSO air transport operators over the two financial years of 2007/08 and 2008/09. Since there was no previous literature on the efficiency of PSO operators, our results deliver some interesting first insights not only into the technical efficiency of these operators but also into some of the determinants of that efficiency. Since the operators run also commercial services (which are included in our analysis) and because the sample is to some extent heterogeneous in that respect (but also because of the different application of PSOs in different EU countries), the results should be interpreted with caution. In general, we find that the technical efficiency scores of the worst performing carriers are better than expected. Even though we have measured the relative performance of the carriers to each other (meaning that even the best performer of these operators may be inefficient compared to airlines not covered by the sample) we initially expected a much wider variety in the efficiency scores across the sampled PSO carriers. In terms of determinants of technical efficiency our regression results suggest that stage length has a negative impact on the operators' efficiency. Our key finding is that operators that are in an early stage of their contracts are more efficient than those that are close to the renewal/re-tendering of their contracts. That this impact is significant regardless of whether one assumes CRS or VRS efficiencies makes it an even more robust finding. Also operators with a large number of PSO contracts appear to be more efficient than those with only a few contracts. However, since we have shown that most of the operators run their operations close to the scale efficient optimum (and if not then they are mostly too big), there appears to be a trade off between number of contracts and ASK and hence it is not fully clear whether big is in general beautiful. Further research is, therefore, required in that respect and should also include other potential determinants of efficiency (such as type of aircraft operated). Once cost data becomes available, it would be interesting to extend the analysis to allocative and cost efficiency.