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Another Look at Airport Congestion Pricing

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Author Info

  • Steven A. Morrison
  • Clifford Winston

Abstract

We study alternate approaches to implement congestion pricing at US airports. Conventional formulations toll all aircraft without determining whether a plane operated by a given airline delays other planes that it operates or planes operated by other airlines. Recent work points out optimal pricing calls for carriers to be charged only for the delay they impose on other airlines. We find a small difference between the net benefits generated by the two congestion-pricing policies because the bulk of airport delays are not internalized and because the efficiency loss from pricing internalized congestion is small. (JEL L11, L93, R41)

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.97.5.1970
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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 97 (2007)
Issue (Month): 5 (December)
Pages: 1970-1977

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Handle: RePEc:aea:aecrev:v:97:y:2007:i:5:p:1970-1977

Note: DOI: 10.1257/aer.97.5.1970
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Cited by:
  1. Santos, Georgina & Robin, Maƫl, 2010. "Determinants of delays at European airports," Transportation Research Part B: Methodological, Elsevier, vol. 44(3), pages 392-403, March.
  2. repec:dgr:uvatin:2013056 is not listed on IDEAS
  3. Brueckner, Jan K. & Verhoef, Erik T., 2010. "Manipulable congestion tolls," Journal of Urban Economics, Elsevier, vol. 67(3), pages 315-321, May.
  4. repec:dgr:uvatin:2009009 is not listed on IDEAS
  5. Czerny, Achim I., 2013. "Public versus private airport behavior when concession revenues exist," Economics of Transportation, Elsevier, vol. 2(1), pages 38-46.
  6. Adler, Nicole & Gellman, Aaron, 2012. "Strategies for managing risk in a changing aviation environment," Journal of Air Transport Management, Elsevier, vol. 21(C), pages 24-35.
  7. Brueckner, Jan K. & Van Dender, Kurt, 2008. "Atomistic congestion tolls at concentrated airports? Seeking a unified view in the internalization debate," Journal of Urban Economics, Elsevier, vol. 64(2), pages 288-295, September.
  8. repec:dgr:uvatin:2011179 is not listed on IDEAS
  9. Zou, Bo & Hansen, Mark, 2012. "Flight delays, capacity investment and social welfare under air transport supply-demand equilibrium," Transportation Research Part A: Policy and Practice, Elsevier, vol. 46(6), pages 965-980.
  10. Czerny, Achim I. & Zhang, Anming, 2011. "Airport congestion pricing and passenger types," Transportation Research Part B: Methodological, Elsevier, vol. 45(3), pages 595-604, March.
  11. Itai Ater, 2007. "Congestion and Market Structure in the Airline Industry," Working Papers 07-28, NET Institute, revised Sep 2007.
  12. Silva, Hugo E. & Verhoef, Erik T., 2013. "Optimal pricing of flights and passengers at congested airports and the efficiency of atomistic charges," Journal of Public Economics, Elsevier, vol. 106(C), pages 1-13.
  13. Zhang, Anming & Zhang, Yimin, 2010. "Airport capacity and congestion pricing with both aeronautical and commercial operations," Transportation Research Part B: Methodological, Elsevier, vol. 44(3), pages 404-413, March.
  14. Brueckner, Jan K., 2009. "Price vs. quantity-based approaches to airport congestion management," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 681-690, June.
  15. Daniel, Joseph I. & Harback, Katherine Thomas, 2009. "Pricing the major US hub airports," Journal of Urban Economics, Elsevier, vol. 66(1), pages 33-56, July.
  16. Basso, Leonardo J. & Zhang, Anming, 2010. "Pricing vs. slot policies when airport profits matter," Transportation Research Part B: Methodological, Elsevier, vol. 44(3), pages 381-391, March.
  17. Rupp, Nicholas G., 2009. "Do carriers internalize congestion costs? Empirical evidence on the internalization question," Journal of Urban Economics, Elsevier, vol. 65(1), pages 24-37, January.
  18. Ashley, Katherine & Savage, Ian, 2010. "Pricing congestion for arriving flights at Chicago O'Hare Airport," Journal of Air Transport Management, Elsevier, vol. 16(1), pages 36-41.

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