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Effect of Slot Trading on Route-Level Competition: Evidence from Experience in the UK

In: Aviation Policies

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  • Hideki Fukui

    (Ehime University)

Abstract

This chapter examines the effect of airport slot trading on route-level competition using data on slot trades in the UK. The estimation results suggest that slot trades among partner carriers contributed to a slightly increased level of competition, measured in terms of the number of competitors per route, whereas slot trades between rival carriers had a negative effect on the number of competitors per route. These findings suggest that carriers have used the slots obtained from their rivals not to compete with them, but to strengthen their dominance on existing routes. This behavior likely stems from the bilateral nature of slot trading, which facilitates mutual forbearance among competitors. To address the potential anticompetitive effects of mutual forbearance, it would be worthwhile to explore both slot-trading schemes that limit opportunities for multimarket contact and alternative methods for primary slot allocation.

Suggested Citation

  • Hideki Fukui, 2025. "Effect of Slot Trading on Route-Level Competition: Evidence from Experience in the UK," Springer Books, in: Aviation Policies, chapter 0, pages 101-134, Springer.
    • Handle: RePEc:spr:sprchp:978-981-96-7303-2_3
    DOI: 10.1007/978-981-96-7303-2_3
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