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(De)regulation of the European Ramp Handling Market – Lessons to Be Learned from an Institutional Perspective?

Author

Listed:
  • Johannes Fuhr

    () (Workgroup for Infrastructure Policy (WIP), Technische Universität Berlin)

Abstract

Ten years have passed since the European Commission obliged its member states to open their national handling markets to competition. This paper analyzes whether the policy has allowed airlines to design efficient contractual and organizational solutions with their ramp handling suppliers. Applying transaction cost economics as the lens of analysis, we propose that the award of temporary limited operating licenses to new entrants results in inferior economic performance. The presented econometric results on the duration of 42 ramp handling contracts and a qualitative case study on the award practices at German airports are largely supportive of this proposition.

Suggested Citation

  • Johannes Fuhr, 2006. "(De)regulation of the European Ramp Handling Market – Lessons to Be Learned from an Institutional Perspective?," Working Papers 2006-08, Center for Network Industries and Infrastructure (CNI).
  • Handle: RePEc:cni:wpaper:2006-08
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    File URL: http://www.cni.tu-berlin.de/fileadmin/documents/RePEc/cni/working_paper/fuhr_deregulation_ramp_handling_cni_wp_no_2006-08.pdf
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    More about this item

    Keywords

    Transaction cost; contract; deregulation; air transport; ramp handling;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
    • L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts

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