Topic: 4. Aviation

A complete indexing and article service is available free from 1967 to 2000

An Analysis of Fortress Hubs in Airline Networks

This paper explores the possibility that the fortress hub is a consequence of the nature of airline hub-spoke rivalry. Entry into a competitor’s local market may reduce the entrant’s profit in his own market. As a result, there is a deterrent to entry if the negative effects are strong enough. The paper also examines the impacts of local competition on consumer surplus and total social surplus.

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The Choice between Cars and Buses on Urban Roads

As a practical criterion it is suggested that a balance between private and public passenger transport might be planned with the object of minimising the total of all journey times. The data needed to implement such a criterion are described and a hypothetical example is give using data relating to Leicester. The method of diverting passengers from private to public transport is not revealed.

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The Airline Oversales Auction Plan: The Results

In 1987 the US Civil Aeronautics Board mandated an auction in cases of oversales, to reduce involuntary passenger removals. Oversales have increased but involuntary removals have greatly decreased. The auction system has been a Pareto improvement, as predicted on the basis of theoretical and empirical evidence.

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The Economics of Direct Flights

Tourist industry officials lobby governments to invest in longer runways and larger terminals in order to accommodate direct flights. The authors evaluate the introduction of direct flights from the west coast of the US to Hawaii’s neighbouring islands, bypassing the previous hub, Honolulu. They find a significant, though modest, increase in travel. Direct flights may not always generate enough additional travel demand to warrant the necessary investments.

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An Economic Analysis of Aircraft Design

Aerodynamics and economics are combined to show the effect on aircraft design of changes in relative prices, especially the price of fuel. Higher capital cost reduces operating cost. Only airlines that operate few miles per year will select cheaper aircraft with high running cost.

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