Marginal Costs and Scale Economies in Spanish Ports: a Multiproduct Approach



Marginal Costs and Scale Economies in Spanish Ports: a Multiproduct Approach

Authors

JARA-DIAZ, CORTES C E, VARGAS A D, University of Chile and MARTINEZ E, Universidad de La Laguna, Chile

Description

The services of Spanish ports can be classified in two main groups according to administrative and financial responsibility: those related to infrastructure and navigation aids, and those related to cargo handling. The former services are managed by the A

Abstract

The services of Spanish ports can be classified in two main groups according to administrative and financial responsibility: those related to infrastructure and navigation aids, and those related to cargo handling. The former services are managed by the Autorid_ad~s Portnarias, who are in charge of the planning, eoustruetion and management of port facilities (besides a regulatory role regarding pert operations). Although the use of common infrastructure makes it difficult to assign this type of costs among the many services provided, good estimates of marginal costs for the different type of commodities that use the port are required for economic efficiency. It is relevant as well to know whether marginal cost pricing would cover infrastructure costs.

In this paper we calculate cargo specific marginal costs, scale and scope economies for the infrastructure services of Spanish ports by means of an estimated long run multiproduet cost function. Data includes 135 observations corresponding to the main 27 Spanish ports between years 1985 and 1989. In the next seeti0n we present the main multioutput concepts in order to build a specific framework for the analysis of Spanish ports, which is presented in section three. The estimated cost fimetion is shown in section four, including the main results in terms of long run marL, inal.eosts and economies of scale. The main conclusions and some additional comments are presented in the last section.

Publisher

Association for European Transport