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Persistence and dynamics in the efficiency of toll motorways: The Spanish case

José F. Baños-Pino, David Boto-García and Emma Zapico

Economics of Transportation, 2022, vol. 31, issue C

Abstract: This study performs an empirical analysis of the productive efficiency of toll motorway concessionaire companies in Spain. We estimate a dynamic stochastic frontier model using an input-oriented distance function for 30 concessionaires during the 2003–2015 period. Considering a multi-output production technology with light and heavy vehicles, we estimate an autoregressive dynamic specification under a Bayesian framework that acknowledges persistence in firm efficiency due to adjustment costs. Our results reveal: (i) large persistence in productive inefficiency in the toll motorway sector, (ii) technical change from 2006 onwards, and (iii) increasing returns to scale. We derive both short- and long-run inefficiency estimates and document that long-run inefficiency increases with the number of stretches a firm manages; however, inefficiency is unrelated to the political authority that grants the concession. We also find that the marginal cost of light vehicle-kilometres is about half that for heavy vehicles.

Keywords: Dynamic inefficiency; Toll motorways; Concessionaire heterogeneity; Bayesian stochastic frontier analysis; Input distance function (search for similar items in EconPapers)
JEL-codes: C40 R41 R42 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1016/j.ecotra.2022.100270

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