The economics of port authority reform. A framework for ex-post evaluation

The activities of a port authority form but one of several factors that can contribute to the competitiveness of a port. A port authority can increase its contribution by optimising the various functions it performs in a facilitating and entrepreneurial manner. Port authority reform matters in that it must set the right governance framework for port authorities to achieve their full potential contribution to the competitiveness of their ports. The objective of this paper is to complement existing literature and empirical research on the role of port authorities with a theoretical perspective on how to measure the specific economic impact of port authority reform and understand the process of reform and post-reform governance. The paper outlines a comprehensive analytical framework to assess both elements in a quantitative and qualitative manner. The centrepiece of the framework is based on welfare economics concepts. It introduces a methodology based on techniques of cost-benefit analysis and generalised costs to measure the economic impact of port authority reform on the competitiveness of a port. The application of the framework for ex-post evaluation will allow policy-makers to identify areas of further improvement and will offer useful insights for those envisaging new reform schemes.