Congestion Pricing vs. Slot Constraints to Airport Networks
AbstractCongestion has become a problem for many airports throughout the world. Two different policy options to control congestion are analyzed in this paper: slot constraints and congestion pricing. In particular, our model takes into account that the airline industry is characterized by significant demand uncertainty. Furthermore, due to the network character of the airline industry, the demand for airport capacities normally is complementary. We show that this favors the use of slot constraints compared to congestion pricing from a social point of view. In contrast, for monopolistic airports, prices as instruments constitute a dominant choice.
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Bibliographic InfoPaper provided by Center for Network Industries and Infrastructure (CNI) in its series Working Papers with number 2006-02.
Length: 23 pages
Date of creation: 2006
Date of revision:
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Slots; uncertainty; monopolistic airports; regulation;
Find related papers by JEL classification:
- D42 - Microeconomics - - Market Structure and Pricing - - - Monopoly
- L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-01-14 (All new papers)
- NEP-NET-2007-01-14 (Network Economics)
- NEP-REG-2007-01-14 (Regulation)
- NEP-URE-2007-01-14 (Urban & Real Estate Economics)
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