Do Competition and Ownership Matter? Evidence from Local Public Transport in Europe

42 Pages Posted: 24 Feb 2010

See all articles by Andrea Boitani

Andrea Boitani

Catholic University of the Sacred Heart of Milan

Marcella Nicolini

University of Pavia - Department of Economics and Management

Carlo Scarpa

University of Brescia; NERA Economic Consulting

Date Written: February 22, 2010

Abstract

This paper investigates how the ownership and the procedure for the selection of firms operating in the local public transport sector affect their productivity. In order to compare different institutional regimes, we carry out a comparative analysis of 72 companies operating in large European cities. This allows us to consider firms selected either through competitive tendering or negotiated procedures. The analysis of the data on 77 European firms over the period 1997-2006 indicates that firms operate under constant returns to scale. Retrieving the residuals we obtain a measure of total factor productivity, which we regress on firm and city characteristics. We find that when firms are totally or partially in public hands their productivity is lower. Moreover, firms selected through competitive tendering display higher total factor productivity.

Keywords: Local Public Transport, Public Ownership, Translog Production Function

JEL Classification: C33, K23, L25, L33, L91

Suggested Citation

Boitani, Andrea and Nicolini, Marcella and Scarpa, Carlo, Do Competition and Ownership Matter? Evidence from Local Public Transport in Europe (February 22, 2010). FEEM Working Paper No. 9.2010. Available at SSRN: https://ssrn.com/abstract=1557151 or http://dx.doi.org/10.2139/ssrn.1557151

Andrea Boitani

Catholic University of the Sacred Heart of Milan ( email )

Largo Gemelli, 1
Via Necchi 9
Milan, MI 20123
Italy

Marcella Nicolini (Contact Author)

University of Pavia - Department of Economics and Management ( email )

Strada Nuova, 65
Pavia, 27100
Italy

Carlo Scarpa

University of Brescia ( email )

Via San Faustino 74B
Dipartimento di Scienze Economiche
25122 Brescia
Italy
+39+030+2988+833 (Phone)
+39+030+2988+839/840 (Fax)

NERA Economic Consulting ( email )

50 Main Street, 14th Floor
White Plains, NY 10606
United States

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