Abstract
Input congestion very likely existed in rail transport. However, early works measuring the rail transport efficiencies rarely took the input congestion into account; hence, the proposed strategies for enhancing efficiencies can be misleading. This study revisited the rail transport efficiencies with consideration of input congestion. We employed data envelopment analysis extension method to investigate the input congestion for some selected 24 European Union (EU) railways in 2006. The results indicated that there is no strong congestion in these 24 railways. However, 12 railways have been diagnosed with weak congestion in the available capacity of freight transport as well as the number of locomotives, 7 railways in the available capacity of passenger transport, and 4 railways in the number of employees. Based on our findings, the managerial implication is to contract the available capacity of freight transport (tonnages) as the most critical strategy, rather than laying-off the excess number of employees suggested by most previous studies, which did not consider the input congestion effects while measuring the rail transport efficiencies.
Highlights
Rail transport has long been playing a critical role in developing different countries’ economics; numerous railways have significantly lost business to other modes, such as highway and air, over the past decades
The managerial implication is to contract the available capacity of freight transport as the most critical strategy, rather than laying-off the excess number of employees suggested by most previous studies, which did not consider the input congestion effects while measuring the rail transport efficiencies
The results indicated that the Association had been operating under Decreasing Returns to Scale (DRS) for the last ten years
Summary
Rail transport has long been playing a critical role in developing different countries’ economics; numerous railways have significantly lost business to other modes, such as highway and air, over the past decades. Taking the freight transport as an example, the market share (ton-km) for European Union (EU) railways has declined from 32% in 1970 to 12% in 1999 [1]. The decline of railway market could be attributed to relatively higher level-of-service of other modes; e.g., truckers can deliver furniture from Lyon, France to Milan, Italy in eight hours, while railways need forty-eight hours [2]. It could be attributed to rail’s poor performance in productive efficiency [3]. To be more competitive for the rail transport, enhancing the productive efficiency should be viewed as an important strategy. Rail transport is in effect a labor- and capital-intensive industry. The operation of railways inevitably encounters the constraints of labor law. Railways are usually subject to limitations of system capacity in yards, lines, and/or stations, which may result in input congestion phenomena
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