1Ownership, Contractual Practices and Technical Efficiency: The Case of Urban Public Transport in France

This paper investigates the impact of ownership structure and contractual choices on technical efficiency in the French urban public transport sector. The central proposition, which relies on classical contract theory arguments, is that ownership regime and contractual practices are key determinants of performances. To test this proposition, we use an original panel data set covering 135 different French urban transport networks over the period 1995-2002 and we apply a stochastic frontier methodology. The econometric results corroborate our proposition: the technical efficiency of urban public transport operators depends on the ownership regime and on the type of contract governing their transactions. This research has been supported by the French governmental research program PREDIT. We are grateful to the members of the CERTU, the GART and the UTP for providing us with precious data and for their fruitful comments. We also would like to thank an anonymous referee, the editor, David Starkie, the participants at the 22nd JMA (Hammamet, 2005), at the 9th Thredbo Conference (Lisbon, 2005), at the 9th ISNIE Conference (Barcelona, 2005), and at the ATOM seminars, more particularl