Port Efficiency Measurement Based On Three-Stage Cascade DEA Method

With social and economic development, ports have become not only the hub of transportation networks, but also an important part of the economic system of an entire region. The globalization trend that we witness today means that the resources flow and are being shared in a global scale. Shipping became a key sector for moving resources on a global scale because of advantages it offers such as large volume transport, high efficiency and low cost. Therefore, ports has become the hub of resource allocation, they also plays an important role in the integration of the various production factors, and in developing variety of industrial cluster. The ports operational efficiency is an important manifestation its level of development. Measuring a port’s efficiency is conducive to determine its level of development, identify the gap with newer ports, enhance the port’s resource allocation capability and core competitiveness, which is of great significance for the development of the port.This research adopts three-stage DEA method to measure the relative efficiency, due of the limitations of DEA method and the different external environment of the coastal ports in china. Compared with the traditional DEA, three-stage DEA excludes random errors and the different external environment factors of each port found in the traditional DEA model. In the first phase, we use the original input and output to measure the port’s efficiency; In the second phase, we apply the stochastic frontier analysis to analyze the influence of the input by random errors and environment variables, and then adjust the value of inputs by using the regression results; In the third stage, using the adjusted input, we measure the efficiency once again. Through this process we improved the homogeneity of the ports, making the efficiency value more objective and accurate, meanwhile we can analyze the impact of different environmental factors related to the ports.The results showed that there are some differences between the first phase of the efficiency value and the third stage efficiency values, and the range of variation in the Yangtze River delta port cluster and Pearl River Delta port cluster is larger. This shows that the environment of these two ports cluster is superior to the Bohai Sea port cluster and the Southeast Coastal ports cluster. Among the environmental factors, the average water depth of the port, the highway density of the port’s hinterland and the proportion of highly qualified personnel has a positive effect to the port efficiency. However, the effect of the hinterland’s GDP is not significant. Finally, in accordance with the measurement results, we put forward some suggestions for the ports’ development.