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Regional aviation and the PSO system – Level of Service and social efficiency

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  • BrÃ¥then, Svein
  • Eriksen, Knut Sandberg

Abstract

The variation in Level of Service (LOS) and the objective of the Public Service Obligation (PSO) system raises the need for a method for determining the LOS based on social efficiency measures. Such a method is developed for assessing PSO and LOS in Norway. This paper presents and discusses this method, which may be relevant for other countries that employs similar supporting systems for air transport. A stepwise procedure is suggested for assessing PSO routes: Firstly, a framework for deciding upon LOS for air transport under PSO is presented. Secondly, we present a way of doing rough calculations of socio-economic profitability of PSO routes compared with best alternative transport. Finally, a model is presented which refines these calculations. One finding from the model simulations is that loosening the LOS restrictions on this type of regional aviation may lead to increased ticket prices and a reduced LOS. PSO restrictions may lead to a situation close to social optimum if wisely chosen. The most important step in future research is probably to test and refine the numerical model.

Suggested Citation

  • BrÃ¥then, Svein & Eriksen, Knut Sandberg, 2018. "Regional aviation and the PSO system – Level of Service and social efficiency," Journal of Air Transport Management, Elsevier, vol. 69(C), pages 248-256.
    • Handle: RePEc:eee:jaitra:v:69:y:2018:i:c:p:248-256
    DOI: 10.1016/j.jairtraman.2016.10.002
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    References listed on IDEAS

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    Cited by:

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    6. Budd, Thomas & Suau-Sanchez, Pere & Halpern, Nigel & Mwesiumo, Deodat & Bråthen, Svein, 2021. "An assessment of air passenger confidence a year into the COVID-19 crisis: A segmentation analysis of passengers in Norway," Journal of Transport Geography, Elsevier, vol. 96(C).
    7. Frédéric Dobruszkes & Jean-Michel Decroly & Pere Suau-Sanchez, 2022. "The monthly rhythms of aviation: A global analysis of passenger air service seasonality," ULB Institutional Repository 2013/341140, ULB -- Universite Libre de Bruxelles.
    8. Das, Amit Kumar & Bardhan, Amit Kumar & Fageda, Xavier, 2020. "New regional aviation policy in India: Early indicators and lessons learnt," Journal of Air Transport Management, Elsevier, vol. 88(C).
    9. Leão e Silva, Celso José & de Andrade, Maurício Oliveira & Falcão, Viviane Adriano & da Silva, Carlos Fabricio Assunção, 2022. "The geographical characteristics of subsidized air routes serving as lifelines," Journal of Air Transport Management, Elsevier, vol. 104(C).
    10. Kinene, Alan & Birolini, Sebastian & Cattaneo, Mattia & Granberg, Tobias Andersson, 2023. "Electric aircraft charging network design for regional routes: A novel mathematical formulation and kernel search heuristic," European Journal of Operational Research, Elsevier, vol. 309(3), pages 1300-1315.
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