Martimort, David, Pommey, Guillaume and Pouyet, Jérôme (2022) Optimal regulation design of airports: Investment incentives and impact of commercial services. Transportation Research Part B: Methodological, vol.164. pp. 25-44.

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Identification Number : 10.1016/j.trb.2022.07.008


Modern airports provide commercial services to passengers in addition to aeronautical services to airlines. We analyze the optimal regulation design of the airport when the airport also invests in the quality of its infrastructure. The optimal regulation can be implemented with a price-cap and a subsidy scheme targeted to the investment. We compare that optimal regulation with more constrained scenarios and discuss how commercial services change the need for regulation. We also investigate the consequences of the non-observability of the airport’s investment.

Item Type: Article
Language: English
Date: October 2022
Refereed: Yes
Place of Publication: Oxford
JEL Classification: L22 - Firm Organization and Market Structure - Markets vs. Hierarchies; Vertical Integration; Conglomerates; Subsidiaries
L51 - Economics of Regulation
L93 - Air Transportation
Divisions: TSE-R (Toulouse)
Site: UT1
Date Deposited: 28 Mar 2023 11:02
Last Modified: 28 Mar 2023 11:02
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