Comparing the Efficiency of Public Transportation Subunits Using Data Envelopment Analysis

Abstract

This article discusses the need for a performance measure that compares the efficiencies of subunits within a transportation organization, reflects the diversity of inputs and outputs, and is objective and consistent. The study presents a method for developing such a performance indicator, and illustrates its use with an application to the park-and-ride lots of the Chicago Transit Authority. The proposed method applies Data Envelopment Analysis supplemented by Stochastic Frontier Analysis to estimate efficiency scores for each subunit. The research demonstrates how the scores can provide objective and valid indicators of each subunit’s efficiency, while accounting for key goals and values of internal and external stakeholders. The scores can be practically applied by a transit agency to identify subunit inefficiencies, and, as demonstrated by several brief case studies, this information can be used as the basis for changes that will improve both subunit and system performance.