Airport charges, economic growth, and cost recovery

Anming Zhang and Yimin Zhang

Transportation Research Part E: Logistics and Transportation Review, 2001, vol. 37, issue 1, 25-33

Abstract: This paper shows that "strict" financial break-even for airports may not be socially desirable. To maximize social welfare, airports should be allowed to take losses or make profits at different times while achieving break-even only in the long run. In particular, with economies growing over time, socially optimal pricing for a new airport can involve deficit in its early years and surplus in its later years. This result has practical policy implications for the newly-built or expanded airports especially in the Asia-Pacific region.

Keywords: Airport; charge; Cost; recovery; Long-run; break-even (search for similar items in EconPapers)
Date: 2001
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