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No need to regulate airports with predominantly non-aeronautical revenues

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  • Kratzsch, Uwe
  • Sieg, Gernot

Abstract

This paper analyzes a profit-maximizing private airport with market power in providing aeronautical services. Our model implies that airports with ample capacity may voluntarily abstain from abusing their market power if non-aeronautical revenues are airports’ main source of income. In this case, a price regulation that is confined to the aviation business will be unnecessary from a welfare point of view.

Suggested Citation

  • Kratzsch, Uwe & Sieg, Gernot, 2012. "No need to regulate airports with predominantly non-aeronautical revenues," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 52, pages 1-7.
    • Handle: RePEc:sot:journl:y:2012:i:52:p:7
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    File URL: http://hdl.handle.net/10077/8188
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    References listed on IDEAS

    as
    1. David Starkie, 2001. "Reforming UK Airport Regulation," Journal of Transport Economics and Policy, University of Bath, vol. 35(1), pages 119-135, January.
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    9. Tae Hoon Oum & Anming Zhang & Yimin Zhang, 2004. "Alternative Forms of Economic Regulation and their Efficiency Implications for Airports," Journal of Transport Economics and Policy, University of Bath, vol. 38(2), pages 217-246, May.
    10. Kratzsch, Uwe & Sieg, Gernot, 2011. "Non-aviation revenues and their implications for airport regulation," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 47(5), pages 755-763, September.
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