Monday, June 4, 2012

Economic evaluation of current conditions of competition and efficiency of automotive and rail systems in Colombia

Abstract: This study uses microeconomic data from the transportation systems of land cargo in Colombia: rail and trucking, to determine their degree of allocative efficiency through the non-parametric method Data Envelopment Analysis DEA. The average overall efficiency found was 74.4% for trains and 20.56% for trucks. These figures indicate that rail is more efficient in the allocation of resources. This means that trains in Colombia use their input better than trucks to maximize their production, given the costs and technological characteristics of each system. This is a signal for the design of a public policy for investment in transportation infrastructure that seeks to raise the competitiveness of Colombian exports, investing not only in roads but in complementary systems such as railways too.
Highlights
► Colombia is currently undergoing a backlog of transport infrastructure and high export costs.
► We perform a microeconomic study of transportation systems in Colombia: rail and trucking.
► As a result we found that the rail is much more efficient than the automotive system.
► As policy recommendation the government should consider the investment in railways.
► It is necessary to take into account the strategic value that investment in railways would bring.

by Carlos Andrés Vasco Correa; Applied Microeconomics Group, Universidad de Antioquia, Calle 67 Nro 53-108, Medellín, Colombia; Tel.: +57 3137921189; fax: +57 4 2195843.
Energy Policy via Elsevier Science Direct www.ScienceDirect.com
Volume 46; July, 2012; Pages 78–87
Keywords: Allocative efficiency; Data envelopment analysis; Colombia freight infrastructure

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