Factors affecting aeronautical charges at major US airports

The determinants of aeronautical charges of U.S. airports: A spatial analysis

“…Drawing concentric circles of travel distances around the airport are the most common way to define an airport's catchment area. Bel and Fageda (2009) and Choo (2014) have considered the number of airports in the catchment area to measure the impact of neighboring airports on aeronautical charges. However, the lack of consideration of spatial interaction among neighboring airports may lead to biased and inconsistent estimates.…”

“…Unlike Van Dender ( 2007) and Bel and Fageda (2009), Bilotkach et al (2012) did not detect a significant effect of nearby airports on aeronautical charges. Choo (2014) examined the determinants of aeronautical charges of 59 U.S. airports between 2002 and 2010. She examined the effects of operating costs, cross-subsidization, hub status, governance types, percentage of international and connecting traffic, and competitive forces.…”

“…Thus, the aeronautical charges that airlines pay could have implications on both aeronautical and non-aeronautical operations. Empirically, Van Dender (2007), Bel and Fageda (2009), Bilotkach et al (2012) and Choo (2014) have examined airport pricing and the effect of airport competition on aeronautical charges using a control variable such as the number of airports within a prespecified cluster or distance. However, the implicit assumptions are that, regardless of the distance between them, airports are independent of each other even for airports in the same region, and any competition effect on airport charges is the same.…”

Airport charges and marginal costs for Spanish airports before the process of partial privatization

“…A second wave of empirical studies have tried to differentiate between airport aeronautical charges. Choo (2014) uses a panel dataset covering US airports from 2002 to 2010. His findings reveal strong evidence of cross-subsidization from non-aeronautical revenue to aeronautical charges.…”

Can market power be controlled by regulation of core prices alone? An empirical analysis of airport demand and car rental price

“…He finds that an increase in the passenger quantity reduces average concession revenues, which is consistent with the idea that a reduction in prices for concession goods and services can increase traveling activities. Choo (2014) finds that an increase in the share of revenues derived from concession businesses (and hence a decrease in the share of aeronautical revenues) is associated with a reduction in the aeronautical charge. This is consistent with the basic idea that a reduction in aeronautical charges can lead to a reduction in aeronautical revenues.…”