Productivity change in transport: a survey

Because of the importance of transport in promoting economic development, there has been a long‐standing interest in the performance of transport industries and in the conditions which are likely to promote productivity growth. Fundamental to any debate on the subject, though, is the need to advance a satisfactory account of production and a way of deciding when productive performance has changed. This paper points out that there are pitfalls in the common practice of using measures such as output per man‐hour as an indicator of productivity and argues that a thorough understanding of the relationships between inputs and outputs can proceed from a knowledge of the economic theory of production.

The paper describes the relevant theoretical concepts and then examines applications of that theory in transport industries. It transpires that there is a growing literature on the subject, demonstrating a worldwide and multimodal interest in developing more rigorous and satisfying ways of measuring and analysing productivity difference. The techniques employed range from the more complex models at the forefront of economic theory, to rudimentary methods which are, at best, capable of testing only the simplest types of hypotheses. Nevertheless, it is argued that these studies have achieved a remarkable degree of success in enhancing analysis.

There can be no doubt that techniques will undergo further developments. However, it is likely that the greatest successes will come about through improvements in data which will permit applications of more complex, but proven techniques of analysis in relatively neglected areas such as road and maritime transport.