[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/bla/annpce/v78y2007i1p1-20.html
   My bibliography  Save this article

Measuring Quantity‐Quality Trade‐Offs In Regulation: The Brazilian Freight Railways Case

Author

Listed:
  • Antonio Estache
  • Sergio Perelman
  • Lourdes Trujillo
Abstract
ABSTRACT**: The quantity vs. quality trade‐offs in network industries are well known from the theoretical literature and have been the subject of many empirical assessments, although mostly for the telecoms and energy sectors. The purpose of this paper is to expand the evidence for the railway sector by documenting the importance of this trade‐off in the context of the Brazilian freight railway industry reform, the first example of a railway sector in which tariff revisions are subject to joint output and quality performance indicators. The analysis is based on the calculation of the Malmquist productivity index proposed by Färe et al. (1995) . The decomposable nature of this total factor productivity (TFP) index reveals the prevalence of quantity‐quality trade‐offs up to the end of the reform period, but a positive correlation between them during the period just afterwards. This type of information would certainly be useful for regulation purposes, particularly as an alternative way of taking into account quality without introducing complex, and very often ineffective, penalty schemes.

Suggested Citation

  • Antonio Estache & Sergio Perelman & Lourdes Trujillo, 2007. "Measuring Quantity‐Quality Trade‐Offs In Regulation: The Brazilian Freight Railways Case," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 78(1), pages 1-20, March.
    • Handle: RePEc:bla:annpce:v:78:y:2007:i:1:p:1-20
    DOI: 10.1111/j.1467-8292.2007.00325.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1467-8292.2007.00325.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1467-8292.2007.00325.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Saal, David S & Parker, David, 2001. "Productivity and Price Performance in the Privatized Water and Sewerage Companies of England and Wales," Journal of Regulatory Economics, Springer, vol. 20(1), pages 61-90, July.
    2. Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, April.
    3. Fare, R. & Grosskopf, S. & Roos, P., 1995. "Productivity and quality changes in Swedish pharmacies," International Journal of Production Economics, Elsevier, vol. 39(1-2), pages 137-144, April.
    4. Estache, Antonio & Gonzalez, Marianela & Trujillo, Lourdes, 2002. "What Does "Privatization" Do for Efficiency? Evidence from Argentina's and Brazil's Railways," World Development, Elsevier, vol. 30(11), pages 1885-1897, November.
    5. Giannakis, Dimitrios & Jamasb, Tooraj & Pollitt, Michael, 2005. "Benchmarking and incentive regulation of quality of service: an application to the UK electricity distribution networks," Energy Policy, Elsevier, vol. 33(17), pages 2256-2271, November.
    6. Campos, J., 2001. "Lessons from railway reforms in Brazil and Mexico," Transport Policy, Elsevier, vol. 8(2), pages 85-95, April.
    7. Sappington David E. M., 2003. "The Effects of Incentive Regulation on Retail Telephone Service Quality in the United States," Review of Network Economics, De Gruyter, vol. 2(4), pages 1-21, December.
    8. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    9. A. Michael Spence, 1975. "Monopoly, Quality, and Regulation," Bell Journal of Economics, The RAND Corporation, vol. 6(2), pages 417-429, Autumn.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Arnaud Abad & Rabaozafy Louisa Andriamasy & Walter Briec, 2018. "Surplus measures and luenberger Hicks–Moorsteen productivity indicator," Journal of Economics, Springer, vol. 125(3), pages 279-308, November.
    2. Smith, Andrew S.J. & Ojeda Cabral, Manuel, 2022. "Is higher quality always costly? Marginal costs of quality: Theory and application to railway punctuality," Transportation Research Part A: Policy and Practice, Elsevier, vol. 157(C), pages 258-273.
    3. Holvad, Torben, 2020. "Efficiency analyses for the railway sector: An overview of key issues," Research in Transportation Economics, Elsevier, vol. 82(C).
    4. Walter Briec & Kristiaan Kerstens, 2011. "The Hicks–Moorsteen Productivity Index Satisfies The Determinateness Axiom," Manchester School, University of Manchester, vol. 79(4), pages 765-775, July.
    5. Link, Heike, 2019. "The impact of including service quality into efficiency analysis: The case of franchising regional rail passenger serves in Germany," Transportation Research Part A: Policy and Practice, Elsevier, vol. 119(C), pages 284-300.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Chen Lin & Sanford Berg, 2008. "Incorporating Service Quality into Yardstick Regulation: An Application to the Peru Water Sector," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 32(1), pages 53-75, February.
    2. Link, Heike, 2019. "The impact of including service quality into efficiency analysis: The case of franchising regional rail passenger serves in Germany," Transportation Research Part A: Policy and Practice, Elsevier, vol. 119(C), pages 284-300.
    3. Michael Schmidthaler & Jed Cohen & Johannes Reichl & Stefan Schmidinger, 2015. "The effects of network regulation on electricity supply security: a European analysis," Journal of Regulatory Economics, Springer, vol. 48(3), pages 285-316, December.
    4. Ajayi, Victor & Anaya, Karim & Pollitt, Michael, 2022. "Incentive regulation, productivity growth and environmental effects: the case of electricity networks in Great Britain," Energy Economics, Elsevier, vol. 115(C).
    5. Nepal, Rabindra & Jamasb, Tooraj, 2015. "Incentive regulation and utility benchmarking for electricity network security," Economic Analysis and Policy, Elsevier, vol. 48(C), pages 117-127.
    6. Çelen, Aydın & Yalçın, Neşe, 2012. "Performance assessment of Turkish electricity distribution utilities: An application of combined FAHP/TOPSIS/DEA methodology to incorporate quality of service," Utilities Policy, Elsevier, vol. 23(C), pages 59-71.
    7. Ajodhia, Virendra & Hakvoort, Rudi, 2005. "Economic regulation of quality in electricity distribution networks," Utilities Policy, Elsevier, vol. 13(3), pages 211-221, September.
    8. Núñez, F. & Arcos-Vargas, A. & Villa, G., 2020. "Efficiency benchmarking and remuneration of Spanish electricity distribution companies," Utilities Policy, Elsevier, vol. 67(C).
    9. Ovaere, Marten, 2023. "Cost-efficiency and quality regulation of energy network utilities," Energy Economics, Elsevier, vol. 120(C).
    10. Schober, Dominik & Weber, Christoph, 2015. "Refinancing under yardstick regulation with investment cycles: The case of long-lived electricity network assets," ZEW Discussion Papers 15-065, ZEW - Leibniz Centre for European Economic Research.
    11. Abate, Megersa & Lijesen, Mark & Pels, Eric & Roelevelt, Adriaan, 2013. "The impact of reliability on the productivity of railroad companies," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 51(C), pages 41-49.
    12. Dominik Schober, 2013. "Refinancing under Yardstick Regulation with Investment Cycles–The Case of Long-Lived Electricity Network Assets," EWL Working Papers 1321, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Jun 2013.
    13. Viktoria Kocsis & Victoria Shestalova & Henry van der Wiel & Nick Zubanov & Ruslan Lukach & Bert Minne, 2009. "Relation entry, exit and productivity: an overview of recent theoretical and empirical literature," CPB Document 180.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    14. Ajayi, V. & Pollitt, M., 2022. "Changing times: Incentive regulation, corporate reorganisations, and productivity in the Great Britain’s gas networks," Cambridge Working Papers in Economics 2254, Faculty of Economics, University of Cambridge.
    15. Rey, Patrick & Salant, David, 2012. "Abuse of dominance and licensing of intellectual property," International Journal of Industrial Organization, Elsevier, vol. 30(6), pages 518-527.
    16. A. Guerrini & G. Romano & L. Carosi & F. Mancuso, 2017. "Cost Savings in Wastewater Treatment Processes: the Role of Environmental and Operational Drivers," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 31(8), pages 2465-2478, June.
    17. Forsund, Finn R. & Sarafoglou, Nikias, 2005. "The tale of two research communities: The diffusion of research on productive efficiency," International Journal of Production Economics, Elsevier, vol. 98(1), pages 17-40, October.
    18. Vincenzo Atella & Jay Bhattacharya & Lorenzo Carbonari, 2008. "Pharmaceutical Industry, Drug Quality and Regulation: Evidence from US and Italy," NBER Working Papers 14567, National Bureau of Economic Research, Inc.
    19. Nykamp, Stefan & Andor, Mark & Hurink, Johann L., 2012. "‘Standard’ incentive regulation hinders the integration of renewable energy generation," Energy Policy, Elsevier, vol. 47(C), pages 222-237.
    20. Bergman, Mats A. & Johansson, Per & Lundberg, Sofia & Spagnolo, Giancarlo, 2016. "Privatization and quality: Evidence from elderly care in Sweden," Journal of Health Economics, Elsevier, vol. 49(C), pages 109-119.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:annpce:v:78:y:2007:i:1:p:1-20. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=1370-4788 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.