Disentangling the European airlines efficiency puzzle: a network data envelopment analysis approach

Duygun, Meryem; Prior, Diego; Shaban, Mohamed; Tortosa-Ausina, Emili

Abstract

© 2015 Elsevier Ltd. In recent years the European airline industry has undergone critical restructuring. It has evolved from a highly regulated market predominantly operated by national airlines to a dynamic, liberalized industry where airline firms compete freely on prices, routes, and frequencies. Although several studies have analyzed performance issues for European airlines using a variety of efficiency measurement methods, virtually none of them has considered two-stage alternatives - not only in this particular European context but in the airline industry in general. We extend the aims of previous contributions by considering a network Data Envelopment Analysis (network DEA) approach which comprises two sub-technologies that can share part of the inputs. Results show that, in general, most of the inefficiencies are generated in the first stage of the analysis. However, when considering different types of carriers several differences emerge - most of the low-cost carriers' inefficiencies are confined to the first stage. Results also show a dynamic component, since performance differed across types of airlines during the decade 2000-2010.

Citation

Duygun, M., Prior, D., Shaban, M., & Tortosa-Ausina, E. (2016). Disentangling the European airlines efficiency puzzle: a network data envelopment analysis approach. Omega, 60, 2-14. https://doi.org/10.1016/j.omega.2015.06.004

• Acceptance Date: Jun 9, 2015
• Online Publication Date: Jun 26, 2015
• Publication Date: 2016-04
• Deposit Date: Dec 15, 2015
• Publicly Available Date: Nov 23, 2017
• Journal: Omega
• Print ISSN: 0305-0483
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 60
• Pages: 2-14
• DOI: https://doi.org/10.1016/j.omega.2015.06.004
• Keywords: Airlines; Network DEA
• Public URL: https://hull-repository.worktribe.com/output/382691
• Publisher URL: http://www.sciencedirect.com/science/article/pii/S0305048315001309
• Additional Information: Authors' accepted manuscript of article published in: Omega, 2016, v.60.