Technical Efficiency, Regulation, and Heterogeneity in Japanese Airports

Abstract

In this paper, the random stochastic frontier model is used to estimate the technical efficiency of Japanese airports taking into regulation and heterogeneity in the variables. The airports are ranked according to their productivity for the period 1987 to 2005 and homogenous and heterogeneous variables in the cost function are disentangled. Policy implication is derived.Japan; airports; efficiency; random frontier models; policy implications