Evaluating air navigation service efficiency of European airports utilizing DEA

Abstract

The rising air traffic volume in Europe, and beyond, is demanding. Accordingly, the need for safe but also efficient air traffic management asks for approaches to evaluate service productions by more than just univariate measures. Data Envelopment Analysis (DEA) is a non-parametric method to assess the efficiency of organizations and processes, so-called Decision-Making Units (DMUs). The major advantage of DEA is to reduce multivariate data to a single key performance indicator (KPI). However, this KPI is just one element to analyze the (economic) situation of a DMU, as shown in the contribution at hand. While almost all DEA applications in the field of air transport refer to airports or airlines as complete units, we concentrate on the efficiency measurement of air navigation services (ANS), especially the arrival and departure phases. The set of DMUs comprises 32 major European airports. Due to a considerable amount of data for potential DEA studies of ANS, this contribution discusses the process of data-selection in a first step; the Performance Review Unit of EUROCONTROL provided all data. In a second step, graphical projections of the DEA results are determined by applying the multivariate method of Multidimensional Scaling (MDS). Finally, possible interpretations of underlying latent variables are given. Thus, the proposed approach provides new insights: for air navigation service providers as well as for authorities, i.e. for regulatory purposes. With regard to a liberalized market for air navigation services in Europe, the overall project goal is to develop a powerful tool for ANS regulation.