Regulation in the air: price-and-frequency caps

Etienne Billette de Villemeur

Transportation Research Part E: Logistics and Transportation Review, 2004, vol. 40, issue 6, 465-476

Abstract: In spite of deregulation on the air-transportation markets, many connections are still operated by a single operator on regional markets, in particular in Europe. Evidence thus calls for some regulation in this industry. There is, however, a great concern for the (possibly negative) consequences of price regulation on the quality of services. We argue that both aspects should be considered jointly and propose a mechanism for the decentralization of the optimal structure of services. The regulatory procedure is based on the sole book-keeping data and requires the regulator to use only an estimate of travellers' average value of time.

Keywords: Air; transportation; Price; and; quality; regulation; Value; of; time (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (13)

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