Sea-Port Operational Efficiency: An Evaluation of Five Asian Ports Using Stochastic Frontier Production Function Model

Abstract

Sea-port operational efficiency is critical factor for handling of goods in the international supply chains, and is viewed to impact transportation and logistics which play an important role in trade exchange with other countries. It is important to evaluate operational efficiency of sea-ports to reflect their status and reveal their position in this competitive environment. Moreover, knowing impacts of efficiency of sea-ports on the supply chain is vital for business survival. This study uses stochastic frontier and inefficiency models to analyze sea-port operational efficiency and Delphi technique to seek expert respondents’ opinion on its characteristics. The research also uses structural equation modeling to build a model of sea-port operational efficiency as a further step to examine the significance of the characteristics. The results of this study emphasize the need to improve sea-port operational efficiency, and indicate which characteristics should be given more attention.