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Potential Gains from Mergers in Local Public Transport: An Efficiency Analysis Applied to Germany

Matthias Walter (mwalter.research@googlemail.com) and Astrid Cullmann

No 832, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: We analyze potential gains from hypothetical mergers in local public transport using the non-parametric Data Envelopment Analysis with bias corrections by means of bootstrapping. Our sample consists of 41 public transport companies from Germany's most densely populated region, North Rhine-Westphalia. We merge them into geographically meaningful, larger units that operate partially on a joint tram network. Merger gains are then decomposed into individual technical efficiency, synergy and size effects following the methodology of Bogetoft and Wang [Bogetoft, P., Wang, D., 2005. Estimating the Potential Gains from Mergers. Journal of Productivity Analysis, 23(2), 145-171]. Our empirical findings suggest that substantial gains up to 16 percent of factor inputs are present, mainly resulting from synergy effects.

Keywords: Merger; Public Transport; Efficiency; Data Envelopment Analysis (search for similar items in EconPapers)
JEL-codes: C14 L11 L92 (search for similar items in EconPapers)
Pages: 35 p.
Date: 2008
New Economics Papers: this item is included in nep-com, nep-eff, nep-ind, nep-pbe and nep-ure
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Citations: View citations in EconPapers (9)

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