Brazilian Railways Relations of Production Density, Scale, Scope and Efficiency

Abstract

This article proposes a non-parametric approach to measure scale and scope and a descriptive study to address the relation of the railways’ production density, scale scope and efficiency using a system of equations, graphic analysis, simple regressions and a proposal for the automatic selection of variables for non-parametric analysis purposes that reduces subjectivity. There is a perceptible, statistically significant relation of production density with scale and positive efficiency, suggesting a relation between increase in net freight per kilometre transported and efficiency gains via scale level, but the relation with economies of scope indicate the possibility of diseconomy occurring, albeit not statistically significant. Furthermore, there is heterogeneity among the production scales. The results show the need for further investigation because scale is influenced by production density insofar as the companies with the greatest production density are those with the greatest efficiency but there is no linearity in the economies of scope indicator.