Evaluation of the National Railway Reform in Japan (2009.9)

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CPDP- 44-J(PDF:240KB)	"Evaluation of the National Railway Reform in Japan" (2009.9) Kozo Harimaya (Faculty of Economics, Sapporo Gakuin University) Takashi Yanagawa (Graduate School of Economics, Kobe University) This paper attempts to evaluate the national railway reform in Japan by examining cost structure of the six railway companies after the privatization and computing efficiency of the third sector railways which inherited the money-losing lines from the former Japanese National Railways. First, in order to examine the effect of simultaneous operation of Shinkansen (bullet train) and local trains, we assess scale and scope economies based on estimation of the multiple-output cost function. Next, we investigate the technical efficiency of third sector railways by using a stochastic distance function approach. Our results show that there are no significant scope economies　between the Shinkansen service and the incumbent local railway service. Further, the third sector railways are less efficient than the other local private railways.

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Contents，Author

"Evaluation of the National Railway Reform in Japan" (2009.9)
Kozo Harimaya (Faculty of Economics, Sapporo Gakuin University)
Takashi Yanagawa (Graduate School of Economics, Kobe University)
This paper attempts to evaluate the national railway reform in Japan by examining cost structure of the six railway companies after the privatization and computing efficiency of the third sector railways which inherited the money-losing lines from the former Japanese National Railways. First, in order to examine the effect of simultaneous operation of Shinkansen (bullet train) and local trains, we assess scale and scope economies based on estimation of the multiple-output cost function. Next, we investigate the technical efficiency of third sector railways by using a stochastic distance function approach. Our results show that there are no significant scope economies　between the Shinkansen service and the incumbent local railway service. Further, the third sector railways are less efficient than the other local private railways.