Many airports are facing capacity problems. In the U.S., 25 airports are classified as 'severely congested' by the Federal Aviation Administration, while also in Europe many airports face congestion problems (e.g. London Heathrow, Frankfurt and Amsterdam Schiphol). In the U.S., the (runway) capacity of (larger) airports is usually allocated based on a fast-come first-served principle. When capacity is limited, arriving aircraft cause delays (and thus costs) for other arriving aircraft. Only four U.S. airports (Washington Ronald Reagan, New York LaGuardia, New York Kennedy and Chicago O'Hare) are slot-constrained; slot trading between airlines is allowed at these airports. European airports are usually slot-constrained; slots are allocated by a slot coordinator. The slot-allocation mechanism at most airports is economically inefficient. The users of capacity (airlines) may pay less than the marginal social cost (congestion costs are not paid, entry is deterred), and are not necessarily the (potential) users that attach the highest economic value to the capacity.


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    Title :

    Economics of Airport Congestion Pricing


    Contributors:
    E. Pels (author) / E. T. Verhoef (author)

    Publication date :

    2005


    Size :

    22 pages


    Type of media :

    Report


    Type of material :

    No indication


    Language :

    English




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