Pricing the major hub airports
Implementing congestion pricing at twenty-seven major US airports would reduce delays by thirteen passenger-years and one thousand aircraft-hours every day, saving three to five million dollars. Chicago and Atlanta would save about one thousand dollars per aircraft. Airport revenues would increase about eleven million dollars daily. A bottleneck model with stochastic queues estimates substantial welfare gains whether or not airlines internalize self-imposed delays. Erroneously imposing fees from the non-internalizing specification on internalizing airlines, however, would be a costly mistake. The model calculates equilibrium traffic rates, queuing delays, layover times, connection times, and congestion fee schedules by minute of the day.
|Date of creation:||2008|
|Date of revision:|
|Publication status:||Published in Journal of Urban Economics.|
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"Economics of a Bottleneck,"
636, Queen's University, Department of Economics.
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