How Do Airlines React to Airport Congestion? The Role of Networks

Identifier:  PC:2293

Handle: https://hdl.handle.net/20.500.11797/PC2293

Authors:  Flores-Fillol, Ricardo; Fageda, Xavier, 1975-

Abstract:
In this paper, we investigate the relationship between airline network structure and airport congestion. More specifically, we study the ways in which airlines adjust frequencies to delays (as a measure of airport congestion) depending on the network type they operate. Our results suggest that network structure has a fundamental impact. Thus, while airlines operating fully-connected configurations reduce frequencies in response to more frequent delays, airlines operating hub-and-spoke structures increase frequencies. Therefore, network airlines have incentives to keep frequencies high even if this is at the expense of a greater congestion at their hub airports. This result sheds light on previously unclear results in the literature. Keywords: airline networks; airport congestion; delays. JEL Classification Numbers: L13; L93; R41.