Hub congestion is a major problem and a relevant policy issue because it causes delays and many organizational problems at airports that end up implying unpleasant consequences both for air travelers and airlines. In a competitive framework in which carriers choose aircraft size, this paper suggests that airlines schedule too many flights using overly small aircraft, which constitutes a major contributor to congestion. Two- part congestion tolls, accounting for the congestion imposed on other carriers and the congestion imposed on all passengers, are needed to recover e¢ ciency. Finally, we analyze the validity of the results by studying the effects of network size, airport capacity, competition in layover time, and the formation of airline alliances. Keywords: congestion; hub-and-spoke networks; overprovision of frequency; con- gestion internalization; congestion tolls JEL Classiffication Numbers: L13; L2; L93
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- Brueckner, Jan K., 2005.
"Internalization of airport congestion: A network analysis,"
International Journal of Industrial Organization,
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- Brueckner, Jan K., 2002. "Network Structure and Airline Scheduling," Working Papers 02-0112, University of Illinois at Urbana-Champaign, College of Business.
- Daniel, Joseph I. & Harback, Katherine Thomas, 2008. "(When) Do hub airlines internalize their self-imposed congestion delays?," Journal of Urban Economics, Elsevier, vol. 63(2), pages 583-612, March.
- Joseph I. Daniel & Katherine Thomas Harback, 2005. "(When) Do Hub Airlines Internalize Their Self-Imposed Congestion Delays?," Working Papers 05-08, University of Delaware, Department of Economics.
- Ricardo Flores-Fillol, 2009. "Airline alliances: parallel or complementary?," Applied Economics Letters, Taylor & Francis Journals, vol. 16(6), pages 585-590.
- Flores-Fillol, Ricardo, 2009. "Airline competition and network structure," Transportation Research Part B: Methodological, Elsevier, vol. 43(10), pages 966-983, December. Full references (including those not matched with items on IDEAS)
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