Impacts of Low Cost Carrier Services on Efficiency of the Major U.S. Airports

摘要

While traditionally many LCCs use secondary airports because of the availability of slots;;sparecapacity and low aeronautical cost;;in recent years more and more LCCs are shifting theiroperations to major airports. This has made necessary for some major hub airports to attempt toattract LCC business. Since it is not clear whether such a move would improve or harmefficiency of the hub airports;;this paper investigates this issue using a panel data of 63 majorU.S. airports for the 2007-2010 period. After controlling the effects of other airportcharacteristics on efficiency;;we found non-monotonic relationships between the level of LCCpresence and airport efficiency. Efficiency of airport decreases as LCC presence increases fromvery low level;;reaches the lowest efficiency point;;and then increases as LCC services becomedominant. Our empirical findings suggest existence of economies of airport specialization ineither FSCs or LCCs. The even mix between FSC and LCC services at an airport appears to beinefficient. This result is somewhat contradictory to the findings of recent studies on LCC effectson European airports.