A NOTE ON OPTIMAL AIRPORT PRICING IN A HUB-AND-SPOKE SYSTEM

This paper deals with the socially optimal pricing of airports in a hub-and-spoke network, taking into account explicitly the fact that demands for airport services at hub airport and spoke airports are complementary. It is shown that a welfare gain is to be made by switching from the regime of pricing each airport independently of other airports in the network to the regime of pricing the hub and spoke airports jointly. The results here implies that there may be a welfare loss due to the reduction in allocation efficiency if a network of airports currently being managed by a national government are to be defederalized (or privatized) separately for each airport as is being carried out in Canada and in Australia.

  • Availability:
  • Corporate Authors:

    Elsevier

    The Boulevard, Langford Lane
    Kidlington, Oxford  United Kingdom  OX5 1GB
  • Authors:
    • Oum, T H
    • Zhang, A
    • Zhang, Y
  • Publication Date: 1996-2

Language

  • English

Media Info

Subject/Index Terms

Filing Info

  • Accession Number: 00716631
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Feb 14 1996 12:00AM