Determinants of cargo and eco-efficiencies of global container shipping companies

Date
2020
Authors
Kuo, Kuo-Cheng
Lu, Wen-Min
Kweh, Qian Long
Le, Minh-Hieu
Journal Title
Journal ISSN
Volume Title
Publisher
Emerald Group Publishing Ltd.
Abstract
Purpose: This study aims to evaluate cargo and eco-efficiency of global container shipping companies (CSCs) and explore the determinants of the CSCs' efficiencies. While the former is derived from the CSCs' operational perspective, the latter highlights environmental issue related to carbon emission reduction. Design/methodology/approach: In the first stage, a two-stage double bootstrap approach of data envelopment analysis (DEA) is applied to derive bias-corrected cargo and eco-efficiency of the top ten global CSCs under the variable returns to scale assumption. In the second stage, ordinary least squares and truncated regression are applied to examine determinants of the CSCs' efficiencies. Findings: The DEA results reveal that the cargo efficiency of the CSCs is higher than their eco-efficiency by about 2.6% under variable returns to scale in DEA. However, the bias-corrected results show that the difference is 2.9%. The overall average efficiencies suggest that the CSCs can improve their cargo (eco) efficiency by 6.9% (10.8%). In the second stage, the regression results show that the numbers of ship, return on assets and asset turnover ratio are significantly related to both cargo and eco-efficiencies, whereas the total fleet capacity positively affects cargo efficiency. Research limitations/implications: The results of this study can help the inefficient CSCs make strategic decisions to improve their performance. For example, their business experience and capacity may be contributing to their efficiencies. However, this study only focuses on the container market among the three main markets, namely, dry bulk, wet bulk and container. Originality/value: This study highlights an environmental issue in the shipping industry. While CSCs are operating their cargo efficiently in general, they should also put green initiatives into their business operations for the long-term sustainability. © 2020, Emerald Publishing Limited.
Description
This article is not available at CUD collection. The version of scholarly record of this article paper is published in International Journal of Logistics Management (2020), available online at: https://doi.org/10.1108/IJLM-01-2020-0016
Keywords
Decision Making Units, Data Envelopment Analysis, DEA Model, Cargo efficiency, Data envelopment analysis, Double bootstrap, Eco-efficiency, Environmental issue, Shipping industry
Citation
Kuo, K.-C., Lu, W.-M., Kweh, Q.L. & Le, M.-H. (2020). Determinants of cargo and eco-efficiencies of global container shipping companies. The International Journal of Logistics Management. https://doi.org/10.1108/IJLM-01-2020-0016