In recent years scholars and practitioners have produced a virtual torrent of literature on the intermingled issues of governmental efficiency, effectiveness, and productivity. Interest in these issues has been generated by rising government costs, inflation and other economic problems, revenue scarcity, and public cynicism regarding governmental performance. Studies have emerged that offer recommendations for improving efficiency, effectiveness, and productivity, 1 although some observers are skeptical of many diagnoses of public sector operations and proposals for change. 2
Productivity is critical to a nation's standard of living and is one of the most central of all management tasks. 3 It typically includes both efficiency and effectiveness. Most observers regard efficiency as the ratio of benefits to costs; effectiveness represents output or achievement relative to some goal or performance standard. 4 Improving performance, therefore, requires increasing the ratio of benefits to costs and/or increasing progress toward some goal. Benefits, costs, and performance standards are not always easily measured and are sometimes controversial, 5 but those difficulties are not universal. This chapter will analyze the financial performance of the Amtrak system over the years.
Certain approaches to industrial productivity have generally emphasized the amount or value of production relative to the amount of labor input. Analyses of agriculture, on the other hand, might focus on production relative to the amount of land under cultivation. Still other studies examine the relationship between production and capital equipment. Because a variety of factors may influence productivity, no single indicator of it is likely to be ideal. However, analyzing the total costs of producing a good or service provides an overall indication of productivity when compared to the amount or value of the good or service produced. 6
Amtrak provides a valuable test case for assessing productivity in several respects. First, a number of observers have charged that Amtrak does not provide benefits sufficient to justify its costs and that it is subsidized