Abstract

This paper models railway operation into three processes: The production process (output/input), the consumption process (consumption/output), and the earnings process (earnings/consumption), making a unified multi-stage framework to measure the performance of Chinese railway bureaus from 1999 to 2008. Firstly, data envelopment analysis (DEA) model is employed to evaluate production efficiency, consumption effectiveness, and earnings effectiveness from the static viewpoint. Secondly, Malmquist TFP index is applied to measure production productivity, consumption productivity, and earnings productivity from the dynamic viewpoint. Thirdly, it assesses the performance of the Chinese railway management system reform in 2005 on railway operations by using an average cumulative Malmquist TFP index.

Key words: Chinese railway system, three-stage railway production analysis, data envelopment analysis, Malmquist TFP index, production efficiency, consumption effectiveness, earnings effectiveness.