Pricing the major hub airports

Joseph I. Daniel () and Katherine Harback
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Katherine Harback: MITRE Center for Advanced Aviation System Development

No 08-13, Working Papers from University of Delaware, Department of Economics

Abstract: 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.

Keywords: airport congestion pricing; stochastic queuing; bottleneck model. (search for similar items in EconPapers)
JEL-codes: R4 H2 L5 L9 (search for similar items in EconPapers)
Date: 2008
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Published in Journal of Urban Economics.

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Persistent link: http://EconPapers.repec.org/RePEc:dlw:wpaper:08-13.

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