Port Privatization, Efficiency and Competitiveness: Some Empirical Evidence from Container Ports (Terminals)

This study investigates the means by which port authorities and operators can achieve and maintain their competitive advantage. A previously-proposed stochastic frontier model that incorporates the inefficiency effect is used to examine whether port privatization is a necessary strategy for ports to gain a competitive advantage. While this stochastic frontier model has been used in a wide number of industries where the technical inefficiency effect is required, this method has rarely been applied to the port industry. This study also investigates the determinants of port competitiveness. Both the principal component analysis and the linear regression model are used to examine the effects of identified key factors on port competitiveness. Based on a sample of selected container terminals around the world, the results of this study have shown that private sector participation in the port industry to some extent can improve port operation efficiency, which will in turn increase port competitiveness. It is suggested that port authorities should remain as regulators while introducing private finance, operation and management. Another important determinant of port competitiveness is adaptability to the customers’ demand.


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  • Accession Number: 01000783
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jun 12 2005 11:39PM