Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
6780721 | Transportation Research Part A: Policy and Practice | 2016 | 12 Pages |
Abstract
This study investigates the effects of airport-airline vertical arrangements on airport capacity choices under demand uncertainty. A multi-stage game is analysed, in which competing airlines contribute to capacity investments and share airport revenues. Our analytical results suggest that for a profit-maximising airport, such a vertical arrangement leads to higher capacity but may not increase its profit, whereas for a welfare-maximising airport, such an arrangement has no effect on capacity or welfare. Capital cost savings brought by airport-airline cooperation, if any, always lead to higher capacity, and to higher profit for a profit-maximising airport and higher welfare for a welfare-maximising airport. Numerical simulations reveal that win-win outcomes may be achieved for an airport and its airlines without government intervention.
Keywords
Related Topics
Physical Sciences and Engineering
Engineering
Civil and Structural Engineering
Authors
Yibin Xiao, Xiaowen Fu, Anming Zhang,