Do contractual practices affect technical efficiency? Evidence from public transport operators in China

Document Type

Journal Article

Publication Date


Subject Area

place - asia, organisation - contracting, organisation - management, economics - appraisal/evaluation


Public transport, Technical efficiency, Contractual practices, Stochastic frontier approach, Trans-log production function, Propensity score matching approach


This paper presents a discussion on the causal effect of contractual practices on the technical efficiency of Chinese public transport operators. To test this proposition, an original panel data set covering 47 operators over the period 2008–2013 is used, we firstly estimate the technical efficiency based on the stochastic frontier approach in a time-varying form of the trans-log production function, and then consider a propensity score matching approach to assess the causal effect between them. The econometric results corroborate this proposition that gross cost contracts offer more incentives to technical efficiency than net cost contracts and management contracts.


Permission to publish the abstract has been given by Elsevier, copyright remains with them.


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