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Airport Barriers to Entry in the US

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  • Martin Dresner
  • Robert Windle
  • Yuliang Yao

Abstract

An examination is conducted on the effects of three airport barriers to entry - slot controls, gate constraints, and gate utilisation during peak operating periods - on both yields and entry in the US airline industry.Data aregathered on allentries into thetop 500 US non-stop city pair markets for the one-year period from the third quarter of 1996 to the second quarter of 1997. Our results show that all three of the barriers have a significant impact on yields, while high gate utilisation during peak airport operating periods is the most significant deterrent to entry. These results indicate that either the construction of new gates, or the undertaking of other provisions to allow new entrants gate access during peak periods, would be most effective in increasing entry onto routes from congested airports. © The London School of Economics and the University of Bath 2002

Suggested Citation

  • Martin Dresner & Robert Windle & Yuliang Yao, 2002. "Airport Barriers to Entry in the US," Journal of Transport Economics and Policy, University of Bath, vol. 36(3), pages 389-405, September.
    • Handle: RePEc:tpe:jtecpo:v:36:y:2002:i:3:p:389-405
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    Cited by:

    1. Steven, Adams B. & Yazdi, Amirhossein Alamdar & Dresner, Martin, 2016. "Mergers and service quality in the airline industry: A silver lining for air travelers?," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 89(C), pages 1-13.
    2. Givoni, Moshe & Rietveld, Piet, 2009. "Airline's choice of aircraft size - Explanations and implications," Transportation Research Part A: Policy and Practice, Elsevier, vol. 43(5), pages 500-510, June.
    3. Pai, Vivek, 2010. "On the factors that affect airline flight frequency and aircraft size," Journal of Air Transport Management, Elsevier, vol. 16(4), pages 169-177.
    4. Fageda, Xavier & Flores-Fillol, Ricardo, 2012. "Air services on thin routes: Regional versus low-cost airlines," Regional Science and Urban Economics, Elsevier, vol. 42(4), pages 702-714.
    5. Oliveira, Bruno F. & Oliveira, Alessandro V.M., 2022. "An empirical analysis of the determinants of network construction for Azul Airlines," Journal of Air Transport Management, Elsevier, vol. 101(C).
    6. Yimga, Jules, 2024. "The on-time performance effects of a policy change in airport slot restrictions: A synthetic control analysis," Economics of Transportation, Elsevier, vol. 38(C).
    7. Berster, Peter & Gelhausen, Marc C. & Wilken, Dieter, 2015. "Is increasing aircraft size common practice of airlines at congested airports?," Journal of Air Transport Management, Elsevier, vol. 46(C), pages 40-48.
    8. Fukui, Hideki, 2019. "How do slot restrictions affect airfares? New evidence from the US airline industry," Economics of Transportation, Elsevier, vol. 17(C), pages 51-71.
    9. Renan P. de Oliveira & Alessandro V. M. Oliveira & Gui Lohmann, 2021. "A Network-Design Analysis of Airline Business Model Adaptation in the Face of Competition and Consolidation," Transportation Science, INFORMS, vol. 55(2), pages 532-548, March.
    10. Daniel, Joseph I, 2014. "The untolled problems with airport slot constraints," Economics of Transportation, Elsevier, vol. 3(1), pages 16-28.
    11. Ball, Michael O. & Berardino, Frank & Hansen, Mark, 2018. "The use of auctions for allocating airport access rights," Transportation Research Part A: Policy and Practice, Elsevier, vol. 114(PA), pages 186-202.
    12. Pai, Vivek, 2009. "On the Factors that Affect Airline Flight Frequency and Aircraft Size," 50th Annual Transportation Research Forum, Portland, Oregon, March 16-18, 2009 207722, Transportation Research Forum.
    13. Xiao, Yibin & Fu, Xiaowen & Zhang, Anming, 2016. "Airport capacity choice under airport-airline vertical arrangements," Transportation Research Part A: Policy and Practice, Elsevier, vol. 92(C), pages 298-309.
    14. Zhang, Anming & Fu, Xiaowen & Yang, Hangjun (Gavin), 2010. "Revenue sharing with multiple airlines and airports," Transportation Research Part B: Methodological, Elsevier, vol. 44(8-9), pages 944-959, September.
    15. Adler, Nicole & Gellman, Aaron, 2012. "Strategies for managing risk in a changing aviation environment," Journal of Air Transport Management, Elsevier, vol. 21(C), pages 24-35.
    16. Karanki, Fecri & Bilotkach, Volodymyr, 2024. "The impact of Airport business practices and governance forms on excess capacity," Economics of Transportation, Elsevier, vol. 38(C).
    17. B. F. Oliveira & A. V. M Oliveira, 2023. "An empirical analysis of the determinants of network construction for Azul Airlines," Papers 2312.05630, arXiv.org.
    18. Du, Yan & McMullen, B. Starr, 2015. "Is the Decision to Code-Share a Route Different for Virtual and Traditional Code-Share Arrangements?," Journal of the Transportation Research Forum, Transportation Research Forum, vol. 54(1).
    19. Valdes, Victor & Gillen, David, 2018. "The consumer welfare effects of slot concentration and reallocation: A study of Mexico City International Airport," Transportation Research Part A: Policy and Practice, Elsevier, vol. 114(PA), pages 256-269.
    20. Fu, Xiaowen & Homsombat, Winai & Oum, Tae H., 2011. "Airport–airline vertical relationships, their effects and regulatory policy implications," Journal of Air Transport Management, Elsevier, vol. 17(6), pages 347-353.
    21. Gaggero, Alberto A. & Piazza, Giovanni, 2021. "Multilayer networks and route entry into the airline industry: Evidence from the U.S. domestic market," Research in Transportation Economics, Elsevier, vol. 90(C).

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