Efficiency of European Airports: Parametric Versus Non-parametric Approach

This paper presents a performance evaluation of European airports, based on the application both parametric and non-parametric approaches. We have evaluated 115 busiest airports in Europe according to number passengers checked-in 2018. The four inputs we used were Terminals, Runways, Boarding gates, Aircraft stands. Three variables describe outputs, namely, Passengers, Movements, Cargo. method chose apply was Stochastic Frontier Analysis (SFA) with Cobb-Douglas production function, Half-Normal distribution inefficiency component, Normal an error term. As basic SFA model only allows for single output, employed different methods get efficiency score each every airport. Next, airport non-parametrically using several Data Envelope (DEA) models including super-efficiency model. compared results obtained by individual approaches discussed their pros cons. Finally, applied program procedure explore effect forms ownership performance.