Abstract
Passengers can buy souvenirs or rent a car at the airport or in the city-center. This paper develops a basic model with unit demands for airport ancillary and city-center demands to derive equilibrium pricing strategies of profit-maximizing airports and city-center companies and evaluates them from the social viewpoint. Passengers are myopic in the sense that only ticket prices matter for flight decisions or foresighted in the sense that non-aeronautical airport and city-center supplies matter for flight decisions, too. We find that the welfare evaluation of equilibrium airport pricing behavior can be independent of whether passengers are myopic or foresighted.
Original language | English |
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Article number | 101987 |
Journal | Transportation Research Part E: Logistics and Transportation Review |
Volume | 141 |
DOIs | |
Publication status | Published - Sept 2020 |
Keywords
- Airport privatization
- Ancillary goods
- City-center rivalry
- Foresighted passengers
- Myopic passengers
ASJC Scopus subject areas
- Business and International Management
- Civil and Structural Engineering
- Transportation