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Title: Fixed Cost Intensity and Its Implications on the Operational Performance of the Sri Lanka Transport Board
Authors: Gunaruwan, T. Lalithasiri
Keywords: Economies of scale, Fixed cost productivity, Optimum bus depot size, State bus transport operation in Sri Lanka
Issue Date: 2015
Publisher: University of Colombo
Citation: Faculty of Arts International Research Conference - December, 2015
Abstract: The Sri Lanka Transport Board (SLTB), the state-owned bus operator in Sri Lanka, is found to have effectively served the purpose of social inclusivity and welfare service provision over the years; but, has failed in achieving financial viability, evidenced by its heavy debts. This paper presents the findings of a research in which the fixed cost management of SLTB and its relationship to structural parameters and to bus depot operating performance were studied. An intra-organisational examination was performed using cost data for the year 2014, adopting statistical methods such as trend evaluation, regression, outlier identification, and comparison of deviations. The results confirmed the presence of economies of scale and the possibility of operating at an optimum bus-depot size, worked out to be at around 145 buses. A large majority of depots in Sri Lanka were found to be much smaller than this optimal depot size, likely for political reasons.
Appears in Collections:Facutly of Arts International Research Conference - December, 2015

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