Grandfather rights in the market for airport slots

Sieg, Gernot

Grandfather rights are currently used in the European Union to allocate airport slots. This article shows that airports prefer such a use-it-or-lose-it rule to unconditional property rights. Assuming that there are informational asymmetries between airports and air carriers because air carriers have better information on passenger demand, the use-it-or-lose-it rule increases slot use when demand for air transport is low. Airport prots increase and those of the air carriers, together with social welfare, decrease. The prot-maximizing rule is a use-it- g < 1-or-lose-it rule.

Grandfather rights are currently used in the European Union to allocate airport slots. This article shows that airports prefer such a use-it-or-lose-it rule to unconditional property rights. Assuming that there are informational asymmetries between airports and air carriers because air carriers have better information on passenger demand, the use-it-or-lose-it rule increases slot use when demand for air transport is low. Airport prots increase and those of the air carriers, together with social welfare, decrease. The prot-maximizing rule is a use-it- g < 1-or-lose-it rule.

Cite

Citation style:

Sieg, Gernot: Grandfather rights in the market for airport slots. Braunschweig Neue, verbesserte Ausgabe 2009 2009. Institut für Volkswirtschaftslehre.

Access Statistic

Total:
Downloads:
Abtractviews:
Last 12 Month:
Downloads:
Abtractviews:

show details

Rights

Use and reproduction:
All rights reserved

Export