Efficiency and corporate governance of a state-owned enterprise: the case of the Tunisian national railway company

Abstract

The inefficiency of the State-Owned Enterprise is a matter of concern to economists. Among the studies carried out, those based on the theory of corporate governance were found. However, most of these studies focus on comparing the public enterprise governance with that of the private one. Thus, this article departs from this comparison towards an analysis of the governance of public enterprises to understand its inefficiency by examining the case of the Tunisian Railway Company. Starting with the approach used by Lehmann et al. (2002), it uses the Data Envelopment Analysis to evaluate the effectiveness of a governance system. The governance scores obtained were used to explain the ef¬ficiency variables for each year in the sample using regression in temporal data. The analysis revealed significant problems in governance mechanisms related to the lack of information transparency, weaknesses in functions of the government shareholder, and, in particular, control system failures.