DEVELOPING MEASURES OF AIRPORT PRODUCTIVITY AND PERFORMANCE - AN APPLICATION OF DATA ENVELOPMENT ANALYSIS

Many studies have investigated the financial results and economic prod uctivity of airlines but few have investigated the productivity or per formance of airports, and how changes in the industry may have affecte d them. Most airports measure performance strictly in accounting terms by looking at only total costs and revenues and the resulting surplus es or deficits. Few utilize any type of productivity measure or perfor mance indicator. This paper applies Data Envelopment Analysis to asses s the performance of airports. It is used to construct performance ind ices on the basis of the multiple outputs which airports produce and t he multiple inputs which they utilize. In particular we develop produc tivity measures for terminals and airside operations. The performance measures are then used in a second stage Tobit regression in which env ironmental, structural and managerial variables are included. The regr ession results provide a 'net' performance index and also identify whi ch variables the managers have some control over and what the relative importance of each variable is in affecting performance. The data set contains a panel of 21 U.S. airports over a five-year period. (C) 199 7 Elsevier Science Ltd. All rights reserved.