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European air transport public service obligations: a periodic review

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  • Aisling Reynolds-Feighan

Abstract

The ‘Third Package’ of European Union air transport liberalisation measures came into effect on 1 January 1993 and has substantially reduced the restrictions on interstate flight operations. The package of measures also includes provision for the member states to impose ‘public service obligations’ on low-density routes which were deemed necessary for the purposes of regional development. In this paper, it is this legislation which is the main focus of attention. In the second section, the background to and contents of the ‘Third Package’ are reviewed. The competitive implications of these measures are briefly outlined. In Section III, the legislation relating to public service obligation routes is critically examined. The Irish government was first to invoke this legislation and several difficulties have come to light as a result. In the final section, recommendations on improvements to the legislation are proposed, based largely on the equivalent US ‘Essential Air Services’ (EAS) programme.

Suggested Citation

  • Aisling Reynolds-Feighan, 1995. "European air transport public service obligations: a periodic review," Fiscal Studies, Institute for Fiscal Studies, vol. 16(1), pages 58-74, February.
    • Handle: RePEc:ifs:fistud:v:16:y:1995:i:1:p:58-74
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    File URL: http://www.ifs.org.uk/fs/articles/fsreynolds.pdf
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    References listed on IDEAS

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    1. Baumol, William J, 1982. "Contestable Markets: An Uprising in the Theory of Industry Structure," American Economic Review, American Economic Association, vol. 72(1), pages 1-15, March.
    2. Aisling J. Reynolds-Feighan, 1993. "Assessment of performance and prospects for the Irish regional airports," Open Access publications 10197/2964, School of Economics, University College Dublin.
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    Cited by:

    1. Smyth, Austin & Christodoulou, Georgina & Dennis, Nigel & AL-Azzawi, Marwan & Campbell, Jonathan, 2012. "Is air transport a necessity for social inclusion and economic development?," Journal of Air Transport Management, Elsevier, vol. 22(C), pages 53-59.
    2. Aisling J. Reynolds-Feighan, 1999. "Subsidisation policies in the provision of air services to small communities : European and US approaches," Open Access publications 10197/2966, School of Economics, University College Dublin.
    3. Pita, João Pedro & Antunes, António Pais & Barnhart, Cynthia & de Menezes, António Gomes, 2013. "Setting public service obligations in low-demand air transportation networks: Application to the Azores," Transportation Research Part A: Policy and Practice, Elsevier, vol. 54(C), pages 35-48.
    4. Graham, Brian, 1997. "Regional airline services in the liberalized European Union single aviation market," Journal of Air Transport Management, Elsevier, vol. 3(4), pages 227-238.
    5. Merkert, Rico & O’Fee, Basil, 2016. "Managerial perceptions of incentives for and barriers to competing for regional PSO air service contracts," Transport Policy, Elsevier, vol. 47(C), pages 22-33.
    6. Merkert, Rico & Williams, George, 2013. "Determinants of European PSO airline efficiency – Evidence from a semi-parametric approach," Journal of Air Transport Management, Elsevier, vol. 29(C), pages 11-16.
    7. Vega, Amaya & Reynolds-Feighan, Aisling, 2016. "The impact of the great recession on Irish air travel: An intermodal accessibility analysis," Journal of Air Transport Management, Elsevier, vol. 51(C), pages 1-18.
    8. Abreu, José & Fageda, Xavier & Jiménez, Juan Luis, 2018. "An empirical evaluation of changes in Public Service Obligations in Spain," Journal of Air Transport Management, Elsevier, vol. 67(C), pages 1-10.
    9. Santana, Isabel, 2009. "Do Public Service Obligations hamper the cost competitiveness of regional airlines?," Journal of Air Transport Management, Elsevier, vol. 15(6), pages 344-349.
    10. Merkert, Rico & O’Fee, Basil, 2013. "Efficient procurement of public air services—Lessons learned from European transport authorities' perspectives," Transport Policy, Elsevier, vol. 29(C), pages 118-125.
    11. Aisling Reynolds-Feighan, 2000. "The US Airport Hierarchy and Implications for Small Communities," Urban Studies, Urban Studies Journal Limited, vol. 37(3), pages 557-577, March.
    12. Williams, George & Pagliari, Romano, 2004. "A comparative analysis of the application and use of public service obligations in air transport within the EU," Transport Policy, Elsevier, vol. 11(1), pages 55-66, January.
    13. Kinene, Alan & Granberg, Tobias Andersson & Birolini, Sebastian & Adler, Nicole & Polishchuk, Valentin & Skoglund, Jean-Marie, 2022. "An auction framework for assessing the tendering of subsidised routes in air transportation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 159(C), pages 320-337.
    14. Lian, Jon Inge, 2010. "Network dependency and airline competition – Consequences for remote areas in Norway," Journal of Air Transport Management, Elsevier, vol. 16(3), pages 137-143.
    15. Calzada, Joan & Fageda, Xavier, 2014. "Competition and public service obligations in European aviation markets," Transportation Research Part A: Policy and Practice, Elsevier, vol. 70(C), pages 104-116.
    16. Martin HROMÁDKA, 2017. "Definition Of Public Service Obligation Potential In The New Eu Member States," Transport Problems, Silesian University of Technology, Faculty of Transport, vol. 12(1), pages 5-13, March.
    17. Aisling J. Reynolds-Feighan & Joe Durkan, 1997. "The impact of air transport on Ireland's export performance: final report: a study submitted to the Institute of International Trade of Ireland," Open Access publications 10197/114, School of Economics, University College Dublin.
    18. Pita, João P. & Adler, Nicole & Antunes, António P., 2014. "Socially-oriented flight scheduling and fleet assignment model with an application to Norway," Transportation Research Part B: Methodological, Elsevier, vol. 61(C), pages 17-32.

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