IDEAS home Printed from https://ideas.repec.org/a/eee/juecon/v72y2012i2p196-209.html
   My bibliography  Save this article

Internalization of congestion at US hub airports

Author

Listed:
  • Ater, Itai

Abstract

I study delays and congestion patterns in US hub airports during periods of high flight volume. I find that these periods are longer when the share of flights operated by the hub airline is greater, and these longer periods exhibit shorter delays. These results lend support to recent theoretical work on congestion, implying that hub-airlines take into account the impact of their scheduling decisions on the congestion that they bear. The results may suggest that congestion management solutions implemented at hub airports dominated by one airline could have only a limited impact on congestion in general.

Suggested Citation

  • Ater, Itai, 2012. "Internalization of congestion at US hub airports," Journal of Urban Economics, Elsevier, vol. 72(2), pages 196-209.
    • Handle: RePEc:eee:juecon:v:72:y:2012:i:2:p:196-209
    DOI: 10.1016/j.jue.2012.05.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0094119012000368
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jue.2012.05.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Brueckner, Jan K., 2005. "Internalization of airport congestion: A network analysis," International Journal of Industrial Organization, Elsevier, vol. 23(7-8), pages 599-614, September.
    2. Brueckner, Jan K. & Van Dender, Kurt, 2008. "Atomistic congestion tolls at concentrated airports? Seeking a unified view in the internalization debate," Journal of Urban Economics, Elsevier, vol. 64(2), pages 288-295, September.
    3. Forbes, Silke J., 2008. "The effect of air traffic delays on airline prices," International Journal of Industrial Organization, Elsevier, vol. 26(5), pages 1218-1232, September.
    4. Rupp, Nicholas G., 2009. "Do carriers internalize congestion costs? Empirical evidence on the internalization question," Journal of Urban Economics, Elsevier, vol. 65(1), pages 24-37, January.
    5. Jan K. Brueckner, 2002. "Airport Congestion When Carriers Have Market Power," American Economic Review, American Economic Association, vol. 92(5), pages 1357-1375, December.
    6. Daniel, Joseph I. & Harback, Katherine Thomas, 2008. "(When) Do hub airlines internalize their self-imposed congestion delays?," Journal of Urban Economics, Elsevier, vol. 63(2), pages 583-612, March.
    7. Pels, Eric & Verhoef, Erik T., 2004. "The economics of airport congestion pricing," Journal of Urban Economics, Elsevier, vol. 55(2), pages 257-277, March.
    8. Christopher Mayer & Todd Sinai, 2003. "Network Effects, Congestion Externalities, and Air Traffic Delays: Or Why Not All Delays Are Evil," American Economic Review, American Economic Association, vol. 93(4), pages 1194-1215, September.
    9. Peters, Craig, 2006. "Evaluating the Performance of Merger Simulation: Evidence from the U.S. Airline Industry," Journal of Law and Economics, University of Chicago Press, vol. 49(2), pages 627-649, October.
    10. Henderson, J. Vernon, 1981. "The economics of staggered work hours," Journal of Urban Economics, Elsevier, vol. 9(3), pages 349-364, May.
    11. Daniel, Joseph I, 1995. "Congestion Pricing and Capacity of Large Hub Airports: A Bottleneck Model with Stochastic Queues," Econometrica, Econometric Society, vol. 63(2), pages 327-370, March.
    12. Joseph I. Daniel, 2011. "Congestion pricing of Canadian airports," Canadian Journal of Economics, Canadian Economics Association, vol. 44(1), pages 290-324, February.
    13. Basso, Leonardo J. & Zhang, Anming, 2007. "Congestible facility rivalry in vertical structures," Journal of Urban Economics, Elsevier, vol. 61(2), pages 218-237, March.
    14. Daniel, Joseph I. & Harback, Katherine Thomas, 2009. "Pricing the major US hub airports," Journal of Urban Economics, Elsevier, vol. 66(1), pages 33-56, July.
    15. Zhang, Anming & Zhang, Yimin, 2006. "Airport capacity and congestion when carriers have market power," Journal of Urban Economics, Elsevier, vol. 60(2), pages 229-247, September.
    16. Michael Mazzeo, 2003. "Competition and Service Quality in the U.S. Airline Industry," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 22(4), pages 275-296, June.
    17. Brueckner, Jan K., 2009. "Price vs. quantity-based approaches to airport congestion management," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 681-690, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sheard, Nicholas, 2017. "Airport consolidation and the provision of air services," Journal of Air Transport Management, Elsevier, vol. 60(C), pages 31-44.
    2. Ivaldi, Marc & Urdanoz, Miguel & de Villemeur, Étienne, 2007. "Social Costs of Air Traffic Delays," IDEI Working Papers 460, Institut d'Économie Industrielle (IDEI), Toulouse.
    3. Guo, Huanxiu & Jiang, Changmin & Wan, Yulai, 2018. "Can airfares tell? An alternative empirical strategy for airport congestion internalization," Transportation Research Part A: Policy and Practice, Elsevier, vol. 118(C), pages 648-661.
    4. Fageda, Xavier & Flores-Fillol, Ricardo, 2016. "How do airlines react to airport congestion? The role of networks," Regional Science and Urban Economics, Elsevier, vol. 56(C), pages 73-81.
    5. Dixit, Aasheesh & Jakhar, Suresh Kumar, 2021. "Airport capacity management: A review and bibliometric analysis," Journal of Air Transport Management, Elsevier, vol. 91(C).
    6. Lall, Ashish, 2018. "Delays in the New York City metroplex," Transportation Research Part A: Policy and Practice, Elsevier, vol. 114(PA), pages 139-153.
    7. Branko Bubalo, 2021. "Airport Capacity and Performance in Europe -- A study of transport economics, service quality and sustainability," Papers 2102.02379, arXiv.org.
    8. Jiang, Changmin & Zhang, Anming, 2015. "Airport congestion pricing and terminal investment: Effects of terminal congestion, passenger types, and concessionsAuthor-Name: Wan, Yulai," Transportation Research Part B: Methodological, Elsevier, vol. 82(C), pages 91-113.
    9. Brueckner, Jan K. & Lin, Ming Hsin, 2016. "Convenient flight connections vs. airport congestion: Modeling the ‘rolling hub’," International Journal of Industrial Organization, Elsevier, vol. 48(C), pages 118-142.
    10. Xavier Fageda & Ricardo Flores-Fillol, 2017. "Airport Congestion and Airline Network Structure," Advances in Airline Economics, in: The Economics of Airport Operations, volume 6, pages 335-359, Emerald Group Publishing Limited.
    11. Roucolle, Chantal & Seregina, Tatiana & Urdanoz, Miguel, 2020. "Network development and excess travel time," Transport Policy, Elsevier, vol. 94(C), pages 139-152.
    12. Bubalo, Branko, 2021. "Airport Capacity and Performance in Europe - A study of transport economics, service quality and sustainability," EconStor Theses, ZBW - Leibniz Information Centre for Economics, number 229442, October.
    13. Oliveira, Marcus V.R. & Oliveira, Alessandro V.M., 2018. "What drives effective competition in the airline industry? An empirical model of city-pair market concentration," Transport Policy, Elsevier, vol. 63(C), pages 165-175.
    14. Gillen, David & Jacquillat, Alexandre & Odoni, Amedeo R., 2016. "Airport demand management: The operations research and economics perspectives and potential synergies," Transportation Research Part A: Policy and Practice, Elsevier, vol. 94(C), pages 495-513.
    15. Gil, Ricard & Kim, Myongjin, 2021. "Does competition increase quality? Evidence from the US airline industry," International Journal of Industrial Organization, Elsevier, vol. 77(C).
    16. Ren, Junqiushi, 2023. "Financial conditions and incumbent quality responses to entry: Evidence from airlines' on-time performance," Journal of Air Transport Management, Elsevier, vol. 107(C).
    17. William E. Bendinelli & Humberto F. A. J. Bettini & Alessandro V. M. Oliveira, 2024. "Airline delays, congestion internalization and non-price spillover effects of low cost carrier entry," Papers 2401.09174, arXiv.org.
    18. Bendinelli, William E. & Bettini, Humberto F.A.J. & Oliveira, Alessandro V.M., 2016. "Airline delays, congestion internalization and non-price spillover effects of low cost carrier entry," Transportation Research Part A: Policy and Practice, Elsevier, vol. 85(C), pages 39-52.
    19. Bubalo, Branko & Gaggero, Alberto A., 2015. "Low-cost carrier competition and airline service quality in Europe," Transport Policy, Elsevier, vol. 43(C), pages 23-31.
    20. Ivaldi, Marc & Quinet, Emile & Urdanoz, Miguel & de Villemeur, Étienne, 2014. "Airlines, Delays, Social Optimum, Calibration," IDEI Working Papers 842, Institut d'Économie Industrielle (IDEI), Toulouse.
    21. Barkley, Aaron & Mcleod, Kael, 2022. "Congestion and consolidation: An empirical study of a barge shipping merger," Regional Science and Urban Economics, Elsevier, vol. 93(C).
    22. Calzada, Joan & Fageda, Xavier, 2023. "Airport dominance, route network design and flight delays," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 170(C).
    23. Miranda, Victor A.P. & Oliveira, Alessandro V.M., 2018. "Airport slots and the internalization of congestion by airlines: An empirical model of integrated flight disruption management in Brazil," Transportation Research Part A: Policy and Practice, Elsevier, vol. 116(C), pages 201-219.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Silva, Hugo E. & Verhoef, Erik T. & van den Berg, Vincent A.C., 2014. "Airlines’ strategic interactions and airport pricing in a dynamic bottleneck model of congestion," Journal of Urban Economics, Elsevier, vol. 80(C), pages 13-27.
    2. Brueckner, Jan K., 2009. "Price vs. quantity-based approaches to airport congestion management," Journal of Public Economics, Elsevier, vol. 93(5-6), pages 681-690, June.
    3. Brueckner, Jan K. & Verhoef, Erik T., 2010. "Manipulable congestion tolls," Journal of Urban Economics, Elsevier, vol. 67(3), pages 315-321, May.
    4. Silva, Hugo E. & Verhoef, Erik T., 2013. "Optimal pricing of flights and passengers at congested airports and the efficiency of atomistic charges," Journal of Public Economics, Elsevier, vol. 106(C), pages 1-13.
    5. Guo, Huanxiu & Jiang, Changmin & Wan, Yulai, 2018. "Can airfares tell? An alternative empirical strategy for airport congestion internalization," Transportation Research Part A: Policy and Practice, Elsevier, vol. 118(C), pages 648-661.
    6. Jan K. Brueckner, 2008. "Slot-Based Approaches to Airport Congestion Management," CESifo Working Paper Series 2302, CESifo.
    7. Dixit, Aasheesh & Jakhar, Suresh Kumar, 2021. "Airport capacity management: A review and bibliometric analysis," Journal of Air Transport Management, Elsevier, vol. 91(C).
    8. Zhang, Anming & Czerny, Achim I., 2012. "Airports and airlines economics and policy: An interpretive review of recent research," Economics of Transportation, Elsevier, vol. 1(1), pages 15-34.
    9. Gillen, David & Jacquillat, Alexandre & Odoni, Amedeo R., 2016. "Airport demand management: The operations research and economics perspectives and potential synergies," Transportation Research Part A: Policy and Practice, Elsevier, vol. 94(C), pages 495-513.
    10. Brueckner, Jan K. & Van Dender, Kurt, 2008. "Atomistic congestion tolls at concentrated airports? Seeking a unified view in the internalization debate," Journal of Urban Economics, Elsevier, vol. 64(2), pages 288-295, September.
    11. Czerny, Achim I., 2010. "Airport congestion management under uncertainty," Transportation Research Part B: Methodological, Elsevier, vol. 44(3), pages 371-380, March.
    12. Rupp, Nicholas G., 2009. "Do carriers internalize congestion costs? Empirical evidence on the internalization question," Journal of Urban Economics, Elsevier, vol. 65(1), pages 24-37, January.
    13. Czerny, Achim I. & Zhang, Anming, 2014. "Airport peak-load pricing revisited: The case of peak and uniform tolls," Economics of Transportation, Elsevier, vol. 3(1), pages 90-101.
    14. Achim I. Czerny & Anming Zhang, 2010. "Airport Congestion Pricing and Passenger Types," WHU Working Paper Series - Economics Group 10-01, WHU - Otto Beisheim School of Management.
    15. Verhoef, Erik T. & Silva, Hugo E., 2017. "Dynamic equilibrium at a congestible facility under market power," Transportation Research Part B: Methodological, Elsevier, vol. 105(C), pages 174-192.
    16. Fageda, Xavier & Flores-Fillol, Ricardo, 2016. "How do airlines react to airport congestion? The role of networks," Regional Science and Urban Economics, Elsevier, vol. 56(C), pages 73-81.
    17. Hugo E. Silva & Robin Lindsey & André de Palma & Vincent A. C. van den Berg, 2017. "On the Existence and Uniqueness of Equilibrium in the Bottleneck Model with Atomic Users," Transportation Science, INFORMS, vol. 51(3), pages 863-881, August.
    18. Czerny, Achim I. & Zhang, Anming, 2011. "Airport congestion pricing and passenger types," Transportation Research Part B: Methodological, Elsevier, vol. 45(3), pages 595-604, March.
    19. Boffa, Federico & Fedele, Alessandro & Iozzi, Alberto, 2023. "Congestion and incentives in the age of driverless fleets," Journal of Urban Economics, Elsevier, vol. 137(C).
    20. Lin, Ming Hsin & Zhang, Yimin, 2017. "Hub-airport congestion pricing and capacity investment," Transportation Research Part B: Methodological, Elsevier, vol. 101(C), pages 89-106.

    More about this item

    Keywords

    Congestion; Air transportation; Air delays; Market concentration;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • L50 - Industrial Organization - - Regulation and Industrial Policy - - - General
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:juecon:v:72:y:2012:i:2:p:196-209. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622905 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.