No need to regulate airports with predominantly non-aeronautical revenues

Kratzsch U, Sieg G


Abstract
This paper analyzes a profit-maximizing private airport with market power in providing aeronautical services. Our model implies that airports with ample capacity may voluntarily abstain from abusing their market power if non-aeronautical revenues are airports’ main source of income. In this case, a price regulation that is confined to the aviation business will be unnecessary from a welfare point of view.

Keywords
airport regulation; airport pricing; airline-airport strategic interaction; dual-till; non-aviation revenue



Publication type
Research article (journal)

Peer reviewed
Yes

Publication status
Published

Year
2012

Journal
European Transport - Trasporti Europei

Volume
52

Issue
52

Start page
1

End page
9

Language
English

ISSN
1825-3997

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