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Airport Congestion and Airline Network Structure

In: The Economics of Airport Operations

Author

Listed:
  • Xavier Fageda
  • Ricardo Flores-Fillol

Abstract

We investigate the relationship between airline network structure and airport congestion. More specifically, we study the ways in which airlines adjust capacity to delays depending on the network type they operate. We find some evidence suggesting that airlines operating hub-and-spoke structures react less to delays than airlines operating fully connected configurations. In particular, network airlines have incentives to keep frequency high even if this is at the expense of a greater congestion at their hub airports. We also show that airlines in slot-constrained airports seem to react to higher levels of congestion by using bigger aircraft at lower frequencies; thus, we conclude that conditioning the number of available slots on the levels of delays at the airport seems an effective measure that creates the right incentives for airlines to reduce the congestion they generate.

Suggested Citation

  • 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.
  • Handle: RePEc:eme:aiaezz:s2212-160920170000006013
    DOI: 10.1108/S2212-160920170000006013
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    Cited by:

    1. Fageda, Xavier & Flores-Fillol, Ricardo & Lin, Ming Hsin, 2020. "Vertical differentiation and airline alliances: The effect of antitrust immunity," Regional Science and Urban Economics, Elsevier, vol. 81(C).

    More about this item

    Keywords

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    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation

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