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Airport Congestion and Airline Network Structure
Fageda, Xavier, 1975-; Flores-Fillol, Ricardo
Universitat Rovira i Virgili. Departament d'Economia; Universitat Rovira i Virgili. Centre de Recerca en Economia Industrial i Economia Pública
This paper provides a theoretical and empirical analysis of the relationship between airport congestion and airline network structure. We find that the development of hub-and-spoke (HS) networks may have detrimental effects on social welfare in presence of airport congestion. The theoretical analysis shows that, although airline pro ts are typically higher under HS networks, congestion could create incentives for airlines to adopt fully-connected (FC) networks. However, the welfare analysis leads to the conclusion that airlines may have an inefficient bias towards HS networks. In line with the theoretical analysis, our empirical results show that network airlines are weakly infl uenced by congestion in their choice of frequencies from/to their hub airports. Consistently with this result, we con firm that delays are higher in hub airports controlling for concentration and airport size. Keywords: airlines; airport congestion; fully-connected networks, hub-and-spoke net- works; network efficiency JEL Classifi cation Numbers: L13; L2; L93
338 - Situació econòmica. Política econòmica. Gestió, control i planificació de l'economia. Producció. Serveis. Turisme. Preus
Línies aèries
Aeroports -- Direcció i administració
Empreses -- Direcció i administració
Aviació comercial
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43 p.
Working Paper
Universitat Rovira i Virgili. Departament d'Economia
Documents de treball del Departament d'Economia;2012-33

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