Efficiency Analysis with Different Models: The Case of Container Ports

Abstract

This paper estimates and compares the technical efficiency of the container ports using data envelopment analysis (DEA) and stochastic frontier analysis (SFA) models and check the role of the characteristics of infrastructure on container port efficiency. The comparisons are based on cross-sectional data for 26 world’s major container ports in 2015 using an input variables related to the characteristics of port infrastructure, such as: the total quay length (meter), the maximum alongside depth (meter), the total terminal area (square meter) and the storage capacity thousand Twenty-foot equivalent unit (thousand TEU/year). The result represents the mean DEA-SFA efficiency differential. DEA-BCC model results indicate that 16 container ports have more than 0.5 score efficiency while with the SFA models all container ports achieved score efficiency more than 0.5. The results show that SFA models improve the score technical efficiency of the container ports. The most efficient container ports in 2015 are Shanghai and Shenzhen achieved the high value technical efficiency with an undetectable difference.