Freight transportation efficiency through horizontal cooperation in Flanders

Abstract

This paper describes a practical application of data envelopment analysis (DEA) to the Flemish road transportation sector. The efficiency of 82 road transportation companies responding to a large-scale survey focused on horizontal cooperation is evaluated, based on two inputs and two outputs. Various DEA models are used to identify differences between subgroups of respondents. The results demonstrate that, in general, Flemish road transportation companies operate at unacceptably low efficiency levels. Given the findings that the median company is operating on too small a scale, one apparent remedy would be a dramatic increase in market concentration through mergers and acquisitions.