The costs of a peak-load demand: an application to Gran Canaria airport
Many airports around the world suffer from peak-load demand problems. To meet demand at the peak periods, airports need to over-invest in capacity. However, the costs associated with the peak-load problem are not only those related to the new investment but much more extensive affecting other economic agents. We use data from the airport in Gran Canaria where the peaks in capacity are associated with tourist arrivals and departures. We estimate the costs that demand peaks impose not only on agents located inside the airport, but also to the society in general. The aim of this paper is to provide a methodology for analyzing the costs imposed on those agents and to explore alternative airport policies.
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