A comparative study of airline efficiency in China and India: A dynamic network DEA approach

Using a dynamic network DEA approach, this research examines the efficiency performance of major Chinese and Indian air carriers with a consideration of the airline's internal processes and links as well as the carry-over items that connect consecutive time periods. It is found that two low-cost carriers (LCCs), namely, China's Spring and India's SpiceJet were the most efficient carriers during the period between 2008 and 2015. China's three state-owned airlines performed poorly in both the capacity generation and service stages, particularly the latter. The second-stage regression results confirm that the LCC model and private ownership are significantly associated with better airline efficiency performance. This paper thus calls for continual reforms in China's air transport including further privatisation and policy support for LCCs and private carriers to improve the overall efficiency of this industry.