Are Deregulated Airports More Efficient?

Pierre Picard, Alessandro Tampieri and Xi Wan

Working Papers - Economics from Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa

Abstract: Picard et al. (2019) show that allocative inefficiency may occur in a private airport when passenger fees are regulated. In this paper, we investigate the presence of inefficiency in slot allocation when an airport faces no regulation over per-passenger charges. In the model, passengers favor peak times and the number of available peak-time slots is constrained by airport capacities. Consistent with empirical evidence, we find that fees deregulation solves allocative inefficiency by raising per-passenger fees. However, when the infrastructural resources appear to be more efficiently employed, the increase in fees leads to a fall in social welfare.

Keywords: Slot allocation; Endogenous fee; Airport capacity (search for similar items in EconPapers)
JEL-codes: H21 H23 R41 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2022
New Economics Papers: this item is included in nep-ind, nep-reg and nep-tre
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