INSPIRING FUTURES

Subsidy and productivity in the privatised British passenger railway.

Cowie, Jonathan (2002) Subsidy and productivity in the privatised British passenger railway. Economic Issues, 7 (1). pp. 25-38. ISSN 1363-7029

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Abstract/Description

This paper gives an overview of subsidy reductions in the privatised passenger rail industry in Britain before focusing on productivity performance across the first four years under the privatised structure. Subsidy reductions are analysed in terms of the average annual percentage increase in passenger revenues and/or decreases in costs required to offset these reductions. Productivity is then examined through the use of a Tornqvist productivity index, with passenger train kilometres specified as the output, and labour, traction rolling stock and infrastructure specified as the inputs. For the network as a whole, it is found that total productivity has risen on average by four per cent per annum over the post-privatisation period. Most gains have been achieved through labour reductions and increases in output from improved utilisation of existing inputs. Compared with the performance of the nationalised British Rail, gains made since privatisation are not as high as those made in the later period of public sector management. It is therefore concluded that it is commercialisation, i.e. the move towards a more market orientated organisation, rather than ownership form per se, that has been the key component in productivity gains.

Item Type: Article
Print ISSN: 1363-7029
Uncontrolled Keywords: Railways; Passenger traffic; Subsidy reductions; Productivity measures; Increased productivity; Decreased labour costs; Increased output; Commercial gains;
University Divisions/Research Centres: Faculty of Engineering, Computing and Creative Industries > School of Engineering and the Built Environment
Dewey Decimal Subjects: 300 Social sciences > 380 Commerce, communications & transportation > 385 Railroad transportation
300 Social sciences > 330 Economics > 330 Economics
Library of Congress Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HE Transportation and Communications
Item ID: 1891
Depositing User: RAE Import
Date Deposited: 24 Apr 2008 10:25
Last Modified: 28 Jun 2013 13:14
URI: http://researchrepository.napier.ac.uk/id/eprint/1891

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