Evaluating port efficiency dynamics: A risk-based approach

Qinghe Sun, Li Chen, Qiang Meng

Research output: Journal article publicationJournal articleAcademic researchpeer-review

3 Citations (Scopus)

Abstract

This study proposes a new methodology to quantify the efficiency dynamics of a port over time. While efficiency evaluation has gained full attention in port management, researchers conducting related studies are challenged by temporal variations observed in the collected data. Existing approaches have almost exclusively relied on multivariate normal distributional assumptions of the input and output data, but empirical evidence from real data shows that the port operations data demonstrate long-tail distributions and violate the distributional assumptions. In addition, many existing models are intractable (non-convex) or lack interpretability. Motivated by these challenges, we develop an optimization-based approach for efficiency measurement under uncertainty that is compatible with the conventional non-parametric method. In particular, inspired by the coherent risk measure, we create a risk-based index to measure the efficiency of any operating unit by comparing its observations against a benchmark that is guaranteed to be production possible under a certain risk level. To facilitate the computation of the index, we develop a risk-based port efficiency evaluation (RPE) model, which can be reformulated as an exponential cone program (ECP) and solved efficiently by off-the-shelf solvers. We test our model for a multipurpose port on a real dataset of 3,394 observations showing the proposed approach's merits. We find that the port productivity peaks on Tuesday and Saturday and troughs on Friday. We also provide evidence for the Chinese New Year effect from a port management perspective and draw managerial insights from the study.

Original languageEnglish
Pages (from-to)333-347
Number of pages15
JournalTransportation Research Part B: Methodological
Volume166
DOIs
Publication statusPublished - Dec 2022

Keywords

  • Conic programming
  • Port efficiency
  • Risk measure

ASJC Scopus subject areas

  • Civil and Structural Engineering
  • Transportation

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