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The Impact of Post-9/11 Airport Security Measures on the Demand for Air Travel

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  • Garrick Blalock
  • Vrinda Kadiyali
  • Daniel H. Simon

Abstract

We examine the impact of two post-9/11 airport security measures—baggage screening and federalization of passenger screening—on demand for air travel in the United States. Exploiting the phased introduction of security measures across airports, we find that baggage screening reduced passenger volume by about 6 percent on all flights and by about 9 percent on flights departing from the nation’s 50 busiest airports. In contrast, federalizing passenger screening had little effect on passenger volume. We provide evidence that the reduction in demand was an unintended consequence of baggage screening and not the result of contemporaneous price changes, airport-specific shocks, schedule changes, or other factors. This decline in air travel had a substantial cost. Back-of-the-envelope calculations indicate that the airline industry lost about $1.1 billion because of the decline, which is 11 percent of the loss attributed directly to 9/11.

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File URL: http://www.journals.uchicago.edu/cgi-bin/resolve?id=doi:10.1086/519816
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Bibliographic Info

Article provided by University of Chicago Press in its journal The Journal of Law and Economics.

Volume (Year): 50 (2007)
Issue (Month): ()
Pages: 731-755

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Handle: RePEc:ucp:jlawec:v:50:y:2007:p:731-755

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Web page: http://www.journals.uchicago.edu/JLE/

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Cited by:
  1. Friedrich Schneider & Tilman Brück & Daniel Meierrieks, 2010. "The Economics of Terrorism and Counter-Terrorism: A Survey (Part II)," CESifo Working Paper Series 3012, CESifo Group Munich.
  2. Wang, Xiaofang & Zhuang, Jun, 2011. "Balancing congestion and security in the presence of strategic applicants with private information," European Journal of Operational Research, Elsevier, Elsevier, vol. 212(1), pages 100-111, July.
  3. Severin Borenstein & Nancy L. Rose, 2007. "How Airline Markets Work...Or Do They? Regulatory Reform in the Airline Industry," NBER Working Papers 13452, National Bureau of Economic Research, Inc.

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