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Scale economies and marginal costs in Spanish airports

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  • Martín, Juan Carlos
  • Román, Concepción
  • Voltes-Dorta, Augusto
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    Abstract

    In this paper, we estimate alternative specifications of the Spanish airports' cost function with the objective to provide a comparative analysis on several technological features such as output-specific marginal costs, economies of scale, and the Allen elasticities of substitution. We found evidence of significant and unexhausted scale economies as well as technological development in the Spanish airport industry. The results suggest that traffic consolidation in multi-airport areas such as the Basque Country or Catalonia will result in lower costs for the public operator.

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    Bibliographic Info

    Article provided by Elsevier in its journal Transportation Research Part E: Logistics and Transportation Review.

    Volume (Year): 47 (2011)
    Issue (Month): 2 (March)
    Pages: 238-248

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    Handle: RePEc:eee:transe:v:47:y:2011:i:2:p:238-248

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    Keywords: Airports' cost function Marginal costs Scale economies Translog system;

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    Cited by:
    1. Voltes-Dorta, Augusto & Lei, Zheng, 2013. "The impact of airline differentiation on marginal cost pricing at UK airports," Transportation Research Part A: Policy and Practice, Elsevier, vol. 55(C), pages 72-88.
    2. Vogel, Hans-Arthur & Graham, Anne, 2013. "Devising airport groupings for financial benchmarking," Journal of Air Transport Management, Elsevier, vol. 30(C), pages 32-38.
    3. Martín, Juan Carlos & Rodríguez-Déniz, Héctor & Voltes-Dorta, Augusto, 2013. "Determinants of airport cost flexibility in a context of economic recession," Transportation Research Part E: Logistics and Transportation Review, Elsevier, Elsevier, vol. 57(C), pages 70-84.
    4. Tolga Ülkü & Vahidin Jeleskovic & Jürgen Müller, 2014. "How scale and institutional setting explain the costs of small airports? -An application of spatial regression analysis," MAGKS Papers on Economics, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) 201435, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    5. Hazledine, Tim & Bunker, Rory, 2013. "Airport size and travel time," Journal of Air Transport Management, Elsevier, vol. 32(C), pages 17-23.

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