An Econometric Approach to Performance Determinants of Asian Container Terminals

Abstract

Performance measurement is a crucial exercise in strengthening the competitiveness of a port since the results provide a benchmark by which the port can be assessed relative to others. A large volume of related literature has been accumulated. Studies on which factors are influential to the overall performance of a port, however, are limited. Using two simultaneous equations, this paper aims to empirically identify the determinants of port performance with a data set of major container terminals in Asia. A weighted two-stage least square estimation is applied to solve the equations. The findings show that port performance is significantly influenced by berth utilisation. At the same time, other factors such as the frequency with which shipping lines call at a port, geographical location of a port and economic activities of a port's hinterland also play a role in determining a port's performance.