Abstract
We examine the effects of quantity-based approaches to airport congestion management such as slot restrictions on price dispersion and on-time performance. From the evidence at Newark Liberty International Airport, we find that slot restrictions increase price dispersion and improve on-time performance. Price dispersion originates from heterogeneous price effects, as ticket prices for high-value passengers increase more than that for low-value passengers. Our novel finding is that the share of passengers who have purchased tickets at a top-end price increase despite the price hike. We use various empirical specifications and an analysis on leads and lags of the policy for robustness.
Original language | English |
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Pages (from-to) | 1378-1402 |
Number of pages | 25 |
Journal | Economic Inquiry |
Volume | 59 |
Issue number | 3 |
DOIs | |
State | Published - Jul 2021 |
Keywords
- airlines
- airport congestion
- on-time performance
- price dispersion
- slot controls