The Remarkable Incidence of Congestion in Production: A Review, Empirical Illustration, and Research Agenda

Abstract : This contribution surveys the existing economic literature measuring congestion using nonparametric specifications of technologies. The focus is on the magnitude and especially the incidence of the congestion detected using traditional radial input-oriented efficiency measures. Furthermore, it shows the limitations of this radial measurement and how alternative measurement schemes may reveal higher amounts of congestion. This is empirically illustrated using a variety of secondary data sets (which guarantees replicability of our results).