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A NOTE ON PRODUCTIVITY COMPARISONS BETWEEN AIR CARRIERS

A comparison is provided of seven methods of productivity measurement using a U.S. airline data set. The "decomposition" productivity measures that controlled for varying output characteristics between firms (e.g., network size differences and route density difference) were completely uncorrelated with the "gross" measures that did not. To the extent that output characteristics may vary between firms, the gross measures of productivity should be used with caution when comparing productivity across firms.