EconPapers    
Economics at your fingertips  
 

A three-stage competition game in an air transport network under asymmetric valuation of flight frequencies

Óscar Álvarez-Sanjaime, Pedro Cantos-Sánchez (), Rafael Moner-Colonques and José Sempere-Monerris ()

Economics of Transportation, 2020, vol. 21, issue C

Abstract: This paper analyzes the effects of changes in aeronautical charges as brought by several airport management regimes on the air transport industry. Airlines compete on both price and non-prices variables, where connecting passengers have asymmetric valuations of flight frequencies in different legs. Changes in landing fees trigger airlines reactions on flight frequencies and airfares, whose sign depends on the weight attached to flight frequencies. Thus, an increase in the spoke landing fee leads to more international flights under low valuations of frequencies at spoke airports. Simulation exercises show that profit-maximizing aeronautical charges only at the spoke airport are preferable to those either only at the hub airport or at both airports. Welfare losses are lower when airports are granted to a unique infrastructure manager rather than to independent ones. When frequencies in the hub are highly valued, profit-maximizing charges only at the spoke airport will likely induce a welfare increase.

Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S2212012218301114
Full text for ScienceDirect subscribers only

Related works:
Working Paper: A three-stage competition game in an air transport network under asymmetric valuation of flight frequencies (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecotra:v:21:y:2020:i:c:s2212012218301114

DOI: 10.1016/j.ecotra.2019.100141

Access Statistics for this article

Economics of Transportation is currently edited by Mogens Fosgerau and Erik Verhoef

More articles in Economics of Transportation from Elsevier
Bibliographic data for series maintained by Nithya Sathishkumar ().

 
Page updated 2021-04-04
Handle: RePEc:eee:ecotra:v:21:y:2020:i:c:s2212012218301114