Romano Pagliari

A comparative analysis of the application and use of public service obligations in air transport within the EU

The paper seeks to compare and contrast how different European Economic Area member states have adopted and made use of the public service obligation (PSO) mechanism in air transport. Analysis shows that there is considerable variation in the extent and way in which various countries have adopted the PSO mechanism. Some countries, such as France, the Irish Republic and Norway, have made extensive use of PSOs on their domestic scheduled air services networks. This is in contrast to the approach adopted in the United Kingdom, where a number of lifeline air services are vulnerable to potentially adverse airline pricing and output decisions. This suggests that there are major inconsistencies in the approach and commitment to social air services provision across the European Union which may undermine broader policy initiatives designed to enhance mobility and accessibility.

Evaluating the potential impact of alternative airport pricing approaches on social welfare

Existing approaches to the economic regulation of airports are currently under (or just completed) review in the UK and New Zealand. One of the most critical issues facing policy-makers is whether it is preferable to adopt a single-till or dual-till approach. This paper aims to analyse the potential loss of social welfare as a result of adopting a single/dual-till approach in three airport pricing scenarios. The results show that the dual-till approach is desirable when aeronautical capacity is fully utilised or already over-utilised, while the single-till approach is preferable where excess capacity exists.

A Review of Different Benchmarking Methods in the Context of Regional Airports

This paper reviews the existing literature on airport benchmarking. In addition to assessing the advantages and disadvantages of partial productivity measures (PPM), we also discuss parametric and non-parametric methods with reference to previous applications to the airport sector. Our analytical framework for research synthesis is based on a comparative study of the existing research findings and includes not only results from longitudinal, cross-sectional and panel data analyses but also findings of our own two-stage data envelopment analysis (DEA) case study. Our findings suggest that the more sophisticated approaches can deliver powerful insights into the performance of regional airports. The data for such an analysis are available, yet no previous attempt has been made to apply these methods to the context of regional airports. However, challenges do exist, especially for very small airports, in terms of the reliability, quality, robustness and complexity of such an efficiency analysis. As a result we recommend that an appropriate methodology for comparing the efficiency of regional airports should be based on a combination of PPM with either a two-stage DEA or a stochastic frontier approach approach.

Direct, Moderating and Mediating Effects of Market Orientation on the Performance of Airports in Europe's Peripheral Areas

Abstract As a consequence of deregulation in the airline industry, market forces rather than public service considerations increasingly dictate routes serving airports in Europes peripheral areas. The new market advocates market-driven management practices as a means of satisfying airline customers and implies that airports that adopt a more market-orientated approach than their rivals will perform better. This study investigates the relationship between market orientation and the performance of airports in Europes peripheral areas. The research strategy was implemented using a questionnaire-based survey that was sent by email to managers at 214 airports. Usable responses from 84 airports were received and analysed. The findings demonstrate that market orientation has a significant and positive effect on performance, which is moderated by high levels of market turbulence and a focus on developing leisure services. The findings also demonstrate that the relationship between market orientation and performance is mediated by innovative marketing practices. The paper concludes with some implications for airport managers and recommendations for future research.

Selling grandfather: an analysis of the latest EU proposals on slot trading

Abstract In July 2000, the European Commission issued a consultation paper based on draft proposals to revise the 1993 regulation on airport slot allocation. This long awaited document was the culmination of seven years of thinking within the Commission as to how best to improve the current system of slot allocation at capacity constrained airports within the European Union. One of the proposals contained in the consultation paper involves allowing airlines to buy and sell slots. The aim of this paper is to highlight and address some of the key issues involved.

The impact of airline franchising on air service provision in the Highlands and Islands of Scotland

The aim of this paper is to evaluate the impact of airline franchising on levels of air service provision in the Highlands and Islands of Scotland. Results showed that while air carriers operating under franchise agreements were offering reduced levels of capacity, they were able, assisted by a more suitable mix of aircraft, to deliver significant service improvements. These improvements were manifested in the scheduling of more convenient flight times, a higher proportion of direct services and the introduction of new routes. Compared to the previous incumbent, franchised operators were also better able at managing capacity in relation to demand with increased load factors reported after 1993. The implications of these results is that little evidence could be identified of any substantial deterioration in service levels as a consequence of franchising.