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Effect of concentration in airline market on Spanish airport technical efficiency

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  • Hidalgo-Gallego, Soraya
  • Mateo-Mantecón, Ingrid

Abstract

This paper tries to measure the effect of airline market concentration on airport technical efficiency. With this aim, a Stochastic Frontier Analysis (SFA) is applied, estimating with a one-step procedure technical efficiency and the effect of airlines' market power on that efficiency. Results suggest that when airports are lowly concentrated increasing concentration reduces such inefficiencies. However, this effect practically disappears when airports are highly concentrated. Additionally, the government's policies to improve airports' performance seems to have a positive effect in the short run.

Suggested Citation

  • Hidalgo-Gallego, Soraya & Mateo-Mantecón, Ingrid, 2019. "Effect of concentration in airline market on Spanish airport technical efficiency," Journal of Air Transport Management, Elsevier, vol. 76(C), pages 56-66.
    • Handle: RePEc:eee:jaitra:v:76:y:2019:i:c:p:56-66
    DOI: 10.1016/j.jairtraman.2019.02.003
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