The effect of policy and background variables on total factor productivity for public transit

This paper investigates total factor productivity as a unified measure of transit performance. The approach uses the shift in the cost function of inputs and outputs as the measure of change in productivity. A three step regression procedure was used to estimate model parameters. The approach was applied to a sample of transit agencies. Predictor variables were tested for a two-year period representing different financial and background situations. Hypotheses were tested for static and dynamic measures of environment and policy with capacity and efficiency and for measures of capacity and efficiency with productivity. It was found that when vehicle-miles was the output measure, only vehicle efficiency was related to labor productivity. Further, it was found that when passenger-miles was the output variable, only population and fleet size were good predictors of total factor productivity. Productivity is, in general, stable and approximately constant for these agencies. The implication for transit agencies is to concentrate efforts to improve productivity on highly congested corridors and, overall, through the use of vehicle and manpower scheduling.