1. ¹Department of Applied Economics, University of Oviedo.Av. del Cristo, s/n. 33007 Oviedo, Spain. E-mail: lorena@uniovi.es
2. ²Department of Economics, University of Rovira i Virgili.Av. Universitat 1, Reus 43204, Spain. E-mail: monica.martin@urv.net

Abstract

The growth in intermodal transport has led to an increase in competition between ports. Other factors, such as the globalisation of the economy, European Union interest in integrating the port system into the Transeuropean Transport Network and the reform of the Spanish port system, have encouraged the Spanish Port Authorities to develop competitive strategies to extend their hinterlands. These strategies have often focused on improving port infrastructure in order to improve the efficiency of their services. In this paper, we analyse the extent to which investment expenditure has led to improvements in efficiency and how far this improved efficiency has increased the port's ability to attract traffic. To do so, we use DEA and study inter-port traffic redistribution from the land side. The analysis focused on the Ports of Bilbao and Valencia not only because they are very important in the Spanish port system but also because they both stand out for their investment expenditure, which has led to quite different results. We conclude by discussing the consequences of investment and port location for efficiency and the capacity to attract traffic, respectively.