Pub Date : 2025-02-12DOI: 10.1016/j.ecotra.2025.100398
Evangelia Filiopoulou, Cleopatra Bardaki, Mara Nikolaidou, Christos Michalakelis
An economic viability of last-mile delivery via drones is assessed, offering an investment model comparing traditional motorcycle delivery to drone-based alternatives. Two drone investment options — purchase or lease (Drone-as-a-Service) — were introduced. The proposed last-mile delivery model considers capital and operational costs, calculating Net Present Value(NPV) and Return of Investment (ROI) per investment scenario. For the operational expenses, the energy consumption model for the motorcycle and the drone is formulated. Furthermore, three wind settings — low, medium, and high wind — were examined to account for environmental factors impacting drone performance. The investment model has been formulated and then validated considering the relevant literature as well as realistic information collected during a semi-structured interview with industry experts The findings affirm the financial feasibility of adopting drones for last-mile delivery. Drone-as-a-Service emerged as a more profitable choice, exhibiting improved NPV and ROI over owned drones or motorcycle delivery. Emphasizing DaaS in the investment model presents a probable scenario for the logistics industry, easing their transition to drone technology. Evidence of DaaS viability is of value since it could convince risk-averse distribution vendors to adopt drone delivery.
{"title":"Drone-as-a-Service for last-mile delivery: Evidence of economic viability","authors":"Evangelia Filiopoulou, Cleopatra Bardaki, Mara Nikolaidou, Christos Michalakelis","doi":"10.1016/j.ecotra.2025.100398","DOIUrl":"10.1016/j.ecotra.2025.100398","url":null,"abstract":"<div><div>An economic viability of last-mile delivery via drones is assessed, offering an investment model comparing traditional motorcycle delivery to drone-based alternatives. Two drone investment options — purchase or lease (Drone-as-a-Service) — were introduced. The proposed last-mile delivery model considers capital and operational costs, calculating Net Present Value(NPV) and Return of Investment (ROI) per investment scenario. For the operational expenses, the energy consumption model for the motorcycle and the drone is formulated. Furthermore, three wind settings — low, medium, and high wind — were examined to account for environmental factors impacting drone performance. The investment model has been formulated and then validated considering the relevant literature as well as realistic information collected during a semi-structured interview with industry experts The findings affirm the financial feasibility of adopting drones for last-mile delivery. Drone-as-a-Service emerged as a more profitable choice, exhibiting improved NPV and ROI over owned drones or motorcycle delivery. Emphasizing DaaS in the investment model presents a probable scenario for the logistics industry, easing their transition to drone technology. Evidence of DaaS viability is of value since it could convince risk-averse distribution vendors to adopt drone delivery.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100398"},"PeriodicalIF":2.2,"publicationDate":"2025-02-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143386969","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-02-10DOI: 10.1016/j.ecotra.2025.100397
Marten Ovaere , Stef Proost
We develop a three-stage game with three governments, a EU-US aircraft production duopoly, and competitive airlines. The model determines the optimal combination of fossil fuel taxes and fuel efficiency standards to decarbonize the aviation sector with imperfect competition and technological spillovers, under various government cooperation levels. We find that without international cooperation, technology spillovers prevent large efficiency investments. Fuel taxes are low but exceed domestic climate damages in regions without aircraft production. Regions with domestic aircraft producers subsidize aviation when the social cost of carbon is low. Second, EU-US cooperation increases fuel efficiency, but fuel taxes are lower than without cooperation, such that carbon emission reductions are limited both with and without cooperation. Third, global cooperation yields the largest efficiency gains, but fuel taxes remain below the world climate damage. Finally, achieving net-zero emissions requires a combination of fuel efficiency, demand reduction through higher fuel taxes, and new aviation fuels.
{"title":"Strategic climate policy in global aviation: Aviation fuel taxes and efficiency standards with duopolistic aircraft producers","authors":"Marten Ovaere , Stef Proost","doi":"10.1016/j.ecotra.2025.100397","DOIUrl":"10.1016/j.ecotra.2025.100397","url":null,"abstract":"<div><div>We develop a three-stage game with three governments, a EU-US aircraft production duopoly, and competitive airlines. The model determines the optimal combination of fossil fuel taxes and fuel efficiency standards to decarbonize the aviation sector with imperfect competition and technological spillovers, under various government cooperation levels. We find that without international cooperation, technology spillovers prevent large efficiency investments. Fuel taxes are low but exceed domestic climate damages in regions without aircraft production. Regions with domestic aircraft producers subsidize aviation when the social cost of carbon is low. Second, EU-US cooperation increases fuel efficiency, but fuel taxes are lower than without cooperation, such that carbon emission reductions are limited both with and without cooperation. Third, global cooperation yields the largest efficiency gains, but fuel taxes remain below the world climate damage. Finally, achieving net-zero emissions requires a combination of fuel efficiency, demand reduction through higher fuel taxes, and new aviation fuels.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100397"},"PeriodicalIF":2.2,"publicationDate":"2025-02-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143376869","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-02-05DOI: 10.1016/j.ecotra.2025.100394
Jiyeon Cheon
This paper examines the distributional effects of a Vehicle Miles Traveled (VMT) tax, focusing on the increasing adoption of electric vehicles (EVs) in the United States. Using a two-period model that integrates decisions on vehicle selection and subsequent driving behavior, the study evaluates short-term changes in consumer surplus resulting from replacing a gasoline tax with a VMT tax. The results suggest that a revenue-neutral VMT tax could modestly increase consumer surplus by approximately $2 per vehicle annually. The analysis also reveals that a uniform federal VMT tax rate leads to varying outcomes across states. Furthermore, the findings demonstrate that the policy’s efficiency improves with higher EV adoption rates. Specifically, when EVs account for 5% of the market share, the additional consumer surplus generated by EV adoption is twice the surplus achieved through a revenue-neutral VMT tax.
{"title":"Distributional effects of a vehicle miles traveled tax over the different vehicle efficiency","authors":"Jiyeon Cheon","doi":"10.1016/j.ecotra.2025.100394","DOIUrl":"10.1016/j.ecotra.2025.100394","url":null,"abstract":"<div><div>This paper examines the distributional effects of a Vehicle Miles Traveled (VMT) tax, focusing on the increasing adoption of electric vehicles (EVs) in the United States. Using a two-period model that integrates decisions on vehicle selection and subsequent driving behavior, the study evaluates short-term changes in consumer surplus resulting from replacing a gasoline tax with a VMT tax. The results suggest that a revenue-neutral VMT tax could modestly increase consumer surplus by approximately $2 per vehicle annually. The analysis also reveals that a uniform federal VMT tax rate leads to varying outcomes across states. Furthermore, the findings demonstrate that the policy’s efficiency improves with higher EV adoption rates. Specifically, when EVs account for 5% of the market share, the additional consumer surplus generated by EV adoption is twice the surplus achieved through a revenue-neutral VMT tax.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100394"},"PeriodicalIF":2.2,"publicationDate":"2025-02-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143165214","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-01-30DOI: 10.1016/j.ecotra.2025.100395
Alberto A. Gaggero , Alexander Luttmann
When faced with capacity constraints, firms may moderate demand by increasing prices when demand is known to be high ex-ante (i.e., systematic peak-load pricing). In this article, we examine the extent and duration of systematic peak-load pricing in the days surrounding public holidays in the U.S. airline industry. Applying two-stage least squares techniques to a unique panel of over 18 million fares, we estimate travel premiums ranging from 4.3% to 83.1% in the days surrounding national holidays and from 2.7% to 34.7% in the days surrounding federal holidays. We also find that the duration of the peak-travel period is longer for national holidays and shorter for federal holidays. Examining heterogeneity in holiday peak-load pricing, we find some evidence that travel premiums during national holidays are larger on longer-distance routes, on routes to or from slot-controlled airports, on routes to leisure destinations, and on ultra-low-cost carriers.
{"title":"Systematic peak-load pricing during holiday periods: Evidence from the U.S. airline industry","authors":"Alberto A. Gaggero , Alexander Luttmann","doi":"10.1016/j.ecotra.2025.100395","DOIUrl":"10.1016/j.ecotra.2025.100395","url":null,"abstract":"<div><div>When faced with capacity constraints, firms may moderate demand by increasing prices when demand is known to be high ex-ante (i.e., systematic peak-load pricing). In this article, we examine the extent and duration of systematic peak-load pricing in the days surrounding public holidays in the U.S. airline industry. Applying two-stage least squares techniques to a unique panel of over 18 million fares, we estimate travel premiums ranging from 4.3% to 83.1% in the days surrounding national holidays and from 2.7% to 34.7% in the days surrounding federal holidays. We also find that the duration of the peak-travel period is longer for national holidays and shorter for federal holidays. Examining heterogeneity in holiday peak-load pricing, we find some evidence that travel premiums during national holidays are larger on longer-distance routes, on routes to or from slot-controlled airports, on routes to leisure destinations, and on ultra-low-cost carriers.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100395"},"PeriodicalIF":2.2,"publicationDate":"2025-01-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143165213","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-01-26DOI: 10.1016/j.ecotra.2025.100396
Yifei Cai , Yahua Zhang , Anming Zhang
Using the Generalized Forecast Error Variance Decomposition (GFEVD) method, this study assesses the effects of oil price shocks on both the return and volatility of aviation stocks. Specifically, we examine how different types of oil supply shocks—such as those related to oil supply, economic activity, oil consumption demand, and oil inventory—impact airline returns and volatility. Our findings indicate that fluctuations in airline returns primarily stem from economic activity shocks. However, the volatility of airlines is influenced by a range of shocks. Lastly, we offer important policy implications tailored for airline managers, market investors, and policymakers to navigate this relationship effectively.
{"title":"Oil price shocks and airlines stock return and volatility – A GFEVD analysis","authors":"Yifei Cai , Yahua Zhang , Anming Zhang","doi":"10.1016/j.ecotra.2025.100396","DOIUrl":"10.1016/j.ecotra.2025.100396","url":null,"abstract":"<div><div>Using the Generalized Forecast Error Variance Decomposition (GFEVD) method, this study assesses the effects of oil price shocks on both the return and volatility of aviation stocks. Specifically, we examine how different types of oil supply shocks—such as those related to oil supply, economic activity, oil consumption demand, and oil inventory—impact airline returns and volatility. Our findings indicate that fluctuations in airline returns primarily stem from economic activity shocks. However, the volatility of airlines is influenced by a range of shocks. Lastly, we offer important policy implications tailored for airline managers, market investors, and policymakers to navigate this relationship effectively.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100396"},"PeriodicalIF":2.2,"publicationDate":"2025-01-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143165211","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-01-21DOI: 10.1016/j.ecotra.2025.100393
Claudio A. Piga , Alberto A. Gaggero , Marco Alderighi
We consider a multi-period, limited capacity, unsegmented airline pricing model whose solution returns a sequence of increasing prices based on the order of sale. We show that a positive demand shock corresponding to an increase in the arrival rate reduces within-period price dispersion and has a minor impact on the sequence’s maximum prices. Alternatively, upward shifts in customers’ willingness-to-pay lead to higher maximum prices but do not affect within-period price dispersion. Demand shocks are identified in our sample by the draw that created the stage groups for the UEFA Euro 2016 soccer tournament. After the draw, some flights became suitable to transport foreign supporters to the location where matches were scheduled. Consistent with the theory, a different price behavior is observed between UK and continental European routes.
{"title":"Demand-shock characteristics and pricing behavior: A natural experiment from UEFA Euro 2016","authors":"Claudio A. Piga , Alberto A. Gaggero , Marco Alderighi","doi":"10.1016/j.ecotra.2025.100393","DOIUrl":"10.1016/j.ecotra.2025.100393","url":null,"abstract":"<div><div>We consider a multi-period, limited capacity, unsegmented airline pricing model whose solution returns a sequence of increasing prices based on the order of sale. We show that a positive demand shock corresponding to an increase in the arrival rate reduces within-period price dispersion and has a minor impact on the sequence’s maximum prices. Alternatively, upward shifts in customers’ willingness-to-pay lead to higher maximum prices but do not affect within-period price dispersion. Demand shocks are identified in our sample by the draw that created the stage groups for the UEFA Euro 2016 soccer tournament. After the draw, some flights became suitable to transport foreign supporters to the location where matches were scheduled. Consistent with the theory, a different price behavior is observed between UK and continental European routes.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100393"},"PeriodicalIF":2.2,"publicationDate":"2025-01-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143165212","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-01-11DOI: 10.1016/j.ecotra.2024.100392
Antonio Lara-Galera, Vicente Alcaraz-Carrillo de Albornoz, Juan Molina-Millán, Belén Muñoz-Medina
For some time now, public administrations in many countries have been subject to strict budgetary constraints to control the public deficit. The Public Private Partnership (PPP) model in this context is a useful vehicle to develop public infrastructures. Despite its attractiveness and potential, there is an accumulation of evidence that questions this model with different experiences showing that PPPs are relatively risky projects for all participants. This is especially true for financial creditors, who usually lend up to 85% of the funds needed for financing the project.
The main objective of this research is to develop a methodology for valuing the financial cost of loans in PPP projects for transportation infrastructure, depending on demand risk. This paper proposes the use of option pricing approach to determine the loan spread in PPP transport projects.
To mitigate the risk faced by project financiers, it would be necessary to guarantee the repayment of the debt service. Given that the project's cash flows are uncertain due to demand risk, the cost associated with this guaranty reflects the risk premium that financiers bear as well as the overall cost of financing.
This guarantee may be determined as a derivative (an option) of the project traffic.
To test this methodology, a real regional toll motorway in Spain has been used, comparing the contractual risk premium of the bank loans obtained with the risk premium calculated by the proposed model.
This research indicates that the spread on concessional loans significantly decreases over time, paralleling the reduction in traffic risk, and is notably higher during the initial years of the project. Furthermore, discrepancies between the projected and actual initial traffic have a substantial impact on the risk assumed by lenders. As limitation of this study, it is important to note that in practice the risk premium incorporates other relevant variables for the project and the industry that are not considered in this study.
{"title":"Spread valuation and risk on transport infrastructure loans","authors":"Antonio Lara-Galera, Vicente Alcaraz-Carrillo de Albornoz, Juan Molina-Millán, Belén Muñoz-Medina","doi":"10.1016/j.ecotra.2024.100392","DOIUrl":"10.1016/j.ecotra.2024.100392","url":null,"abstract":"<div><div>For some time now, public administrations in many countries have been subject to strict budgetary constraints to control the public deficit. The Public Private Partnership (PPP) model in this context is a useful vehicle to develop public infrastructures. Despite its attractiveness and potential, there is an accumulation of evidence that questions this model with different experiences showing that PPPs are relatively risky projects for all participants. This is especially true for financial creditors, who usually lend up to 85% of the funds needed for financing the project.</div><div>The main objective of this research is to develop a methodology for valuing the financial cost of loans in PPP projects for transportation infrastructure, depending on demand risk. This paper proposes the use of option pricing approach to determine the loan spread in PPP transport projects.</div><div>To mitigate the risk faced by project financiers, it would be necessary to guarantee the repayment of the debt service. Given that the project's cash flows are uncertain due to demand risk, the cost associated with this guaranty reflects the risk premium that financiers bear as well as the overall cost of financing.</div><div>This guarantee may be determined as a derivative (an option) of the project traffic.</div><div>To test this methodology, a real regional toll motorway in Spain has been used, comparing the contractual risk premium of the bank loans obtained with the risk premium calculated by the proposed model.</div><div>This research indicates that the spread on concessional loans significantly decreases over time, paralleling the reduction in traffic risk, and is notably higher during the initial years of the project. Furthermore, discrepancies between the projected and actual initial traffic have a substantial impact on the risk assumed by lenders. As limitation of this study, it is important to note that in practice the risk premium incorporates other relevant variables for the project and the industry that are not considered in this study.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100392"},"PeriodicalIF":2.2,"publicationDate":"2025-01-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143165306","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-22DOI: 10.1016/j.ecotra.2024.100389
Alix Le Goff , Guillaume Monchambert , Martin Koning
This paper investigates the effects of carpooling organization on the propensity to carpool. We test whether pre-trip planning and the use of a platform influence the choice of carpooling over driving alone and public transport. In a stated choice experiment, we collected responses from 3600 residents of the Lyon urban area, France. Our econometric results suggest that platforms increase individual willingness to carpool, and that the effect of the platform is stronger for passengers than for drivers. We illustrate these results with a stylized social welfare analysis, which reveals a significant contradiction between what would be needed to make carpooling beneficial from a welfare perspective – passengers should be subsidized – and the current pricing schemes, which subsidize mainly drivers.
{"title":"Effects of numerical platforms on individual choices and social welfare: The case of short-distance carpooling","authors":"Alix Le Goff , Guillaume Monchambert , Martin Koning","doi":"10.1016/j.ecotra.2024.100389","DOIUrl":"10.1016/j.ecotra.2024.100389","url":null,"abstract":"<div><div>This paper investigates the effects of carpooling organization on the propensity to carpool. We test whether pre-trip planning and the use of a platform influence the choice of carpooling over driving alone and public transport. In a stated choice experiment, we collected responses from 3600 residents of the Lyon urban area, France. Our econometric results suggest that platforms increase individual willingness to carpool, and that the effect of the platform is stronger for passengers than for drivers. We illustrate these results with a stylized social welfare analysis, which reveals a significant contradiction between what would be needed to make carpooling beneficial from a welfare perspective – passengers should be subsidized – and the current pricing schemes, which subsidize mainly drivers.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100389"},"PeriodicalIF":2.2,"publicationDate":"2024-12-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143165304","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-12DOI: 10.1016/j.ecotra.2024.100382
Maria Fernanda Guajardo Ortega, Heike Link
This study analyses travellers’ behavioural responses to two temporal measures implemented by the German government: the reduction in public transport prices, making it almost fare-free, and a decrease in fuel taxes to the minimum level permitted by European law. Based on a panel dataset of GPS-tracked trips collected before and during the price intervention from a representative sample of 276 individuals, with 1650 commuter trips per month. We estimate mixed logit models incorporating two temporal effects—inertia and shock—to account for habitual behaviour and capture both interventions' impact. The only travel mode with significant inertia is car, indicating that car drivers are less likely to change their travel mode. While the shock parameter for the fuel price intervention was not significant, we found a significant and positive shock effect for public transport which decreased over time during the policy. Furthermore, elasticities calculated pre- and during the intervention are considerably lower when habitual behaviour is considered. From the existence of inertia effects and low price elasticities, we conclude that the temporary intervention of almost fare-free public transport alone was not sufficient to achieve a modal shift from car to public transport for commuter trips.
{"title":"Mode choice inertia and shock: Three months of almost fare-free public transport in Germany","authors":"Maria Fernanda Guajardo Ortega, Heike Link","doi":"10.1016/j.ecotra.2024.100382","DOIUrl":"10.1016/j.ecotra.2024.100382","url":null,"abstract":"<div><div>This study analyses travellers’ behavioural responses to two temporal measures implemented by the German government: the reduction in public transport prices, making it almost fare-free, and a decrease in fuel taxes to the minimum level permitted by European law. Based on a panel dataset of GPS-tracked trips collected before and during the price intervention from a representative sample of 276 individuals, with 1650 commuter trips per month. We estimate mixed logit models incorporating two temporal effects—inertia and shock—to account for habitual behaviour and capture both interventions' impact. The only travel mode with significant inertia is car, indicating that car drivers are less likely to change their travel mode. While the shock parameter for the fuel price intervention was not significant, we found a significant and positive shock effect for public transport which decreased over time during the policy. Furthermore, elasticities calculated pre- and during the intervention are considerably lower when habitual behaviour is considered. From the existence of inertia effects and low price elasticities, we conclude that the temporary intervention of almost fare-free public transport alone was not sufficient to achieve a modal shift from car to public transport for commuter trips.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"41 ","pages":"Article 100382"},"PeriodicalIF":2.2,"publicationDate":"2024-12-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143165305","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2024-12-01DOI: 10.1016/j.ecotra.2024.100381
Xavier Fageda , Ricardo Flores-Fillol
This paper analyzes airlines’ fare and frequency decisions, both theoretically and empirically. These decisions depend on route distance, as only short-haul routes are affected by intermodal competition from personal transportation. Although fares increase with distance both on short- and long-haul routes, the effect of distance on frequencies depends on the presence of intermodal competition. Frequencies decay with distance on long-haul routes. However, on short-haul routes, frequencies increase with distance because airlines try to boost profits by attracting demand from other transportation modes. Finally, on short-haul routes, intermodal competition from personal transportation affects more intensively network carriers than low-cost carriers as distance rises, which produces an increased differentiation between both types of airlines.
{"title":"Service-quality and pricing strategies in the airline industry: The role of distance","authors":"Xavier Fageda , Ricardo Flores-Fillol","doi":"10.1016/j.ecotra.2024.100381","DOIUrl":"10.1016/j.ecotra.2024.100381","url":null,"abstract":"<div><div>This paper analyzes airlines’ fare and frequency decisions, both theoretically and empirically. These decisions depend on route distance, as only short-haul routes are affected by intermodal competition from personal transportation. Although fares increase with distance both on short- and long-haul routes, the effect of distance on frequencies depends on the presence of intermodal competition. Frequencies decay with distance on long-haul routes. However, on short-haul routes, frequencies increase with distance because airlines try to boost profits by attracting demand from other transportation modes. Finally, on short-haul routes, intermodal competition from personal transportation affects more intensively network carriers than low-cost carriers as distance rises, which produces an increased differentiation between both types of airlines.</div></div>","PeriodicalId":45761,"journal":{"name":"Economics of Transportation","volume":"40 ","pages":"Article 100381"},"PeriodicalIF":2.2,"publicationDate":"2024-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143181638","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"工程技术","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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