Econometric Estimation of Scale and Scope Economies Within the Port Sector: A Review

Beatriz Tovar, Jara-Díaz, Sergio and Lourdes Trujillo ()

No 07/04, City University Economics Discussion Papers from Department of Economics, City University, London

Abstract: Seaports provide multiple services to ships, cargo, and passengers. Size of the port and type of service are two key elements when deciding whether competition is feasible and how to promote it, or conversely regulation is needed. Analyzing this requires a profound knowledge of the cost structure of the activity involved. This means not only knowing total costs for different volumes of aggregated traffic, but also the behavior of costs when part of the bundle is produced, i.e. when the mix changes. The optimal organization of the industry can be studied by means of cost and production functions. This paper offers a review of the relatively scarce literature about econometric ports’ cost structure, and highlights the role of the multioutput approach as the correct one because allows the calculation of key cost indicators (economies of scale, scope, and so forth) to determine the optimal port industrial structure for a given forecast of demand (traffic mix and volume).

Keywords: multiproduct; economies of scale and scope; port and cargo handling (search for similar items in EconPapers)
JEL-codes: L9 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-mic
Date: 2007-02

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Persistent link: http://EconPapers.repec.org/RePEc:cty:dpaper:0704

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