A note on optimal airline networks under airport congestion

- Airport congestion is a severe economic problem.
- We examine optimal airline networks under airport congestion.
- Airlines exhibit a preference for hub-and-spoke (HS) configurations.
- Airlines may be inefficiently biased towards HS networks.
- We recommend regulatory tools like congestion pricing or slot constraints.

We extend the monopoly case without congestion in Brueckner (2004) by examining network choice in a duopoly where airport congestion can occur. Airlines prefer hub-and-spoke configurations, even if this implies higher congestion costs. Airlines may be inefficiently biased towards hub-and-spoke networks.