Cost Efficiency Measurement in Postal Delivery Networks

Massimo Filippini and Martin Koller

Quaderni della facoltà di Scienze economiche dell'Università di Lugano from USI Università della Svizzera italiana

Abstract: The purpose of this study is to analyze the level of cost efficiency of Swiss Post's postal delivery units to enable policy makers' as well as Swiss Post to decide on the reactions to market changes. In particular, we use different panel data models to assess cost efficiency in these units to account for unobserved heterogeneity. The results from applying Mundlak's formulation to the Pooled stochastic frontier model provides evidence that this model is not affected by a heterogeneity bias and that the cost efficiency values lie within a lower and upper bound of the other recent and standard econometric frontier models. Overall, the analysis shows that assumptions on unobserved heterogeneity are crucial and that results of econometric cost efficiency measurement models have to be interpreted with corresponding caution.

Keywords: cost efficiency; stochastic frontier models; unobserved heterogeneity; Mundlak; postal delivery network (search for similar items in EconPapers)
JEL-codes: C33 D24 H42 L87 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2012-09
New Economics Papers: this item is included in nep-eff, nep-net, nep-reg and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:lug:wpaper:1206

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