A Stochastic Cost Frontier in the Portuguese Hotel Industry

Carlos Barros

Tourism Economics, 2004, vol. 10, issue 2, 177-192

Abstract: This paper analyses the technical efficiency of a Portuguese state-owned hotel chain, Pousadas de Portugal, in order to investigate the chain's performance. A stochastic cost frontier model is used to generate hotel efficiency scores, assuming that efficiency is time-varying. The author investigates the efficiency and finds that the results are at best mixed, since the efficient scores are low and not time-varying. He therefore proposes an alteration of management procedures to enable an increase in efficiency, based on a governance-environment framework.

Keywords: hotels; technical efficiency; stochastic Cobb–Douglas cost function; Pousada; Portugal (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (22)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:toueco:v:10:y:2004:i:2:p:177-192

DOI: 10.5367/000000004323142416

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