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Aviation Infrastructure Performance

Aviation Infrastructure Performance: A Study in Comparative Political Economy

Copyright Date: 2008
Pages: 237
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  • Book Info
    Aviation Infrastructure Performance
    Book Description:

    Aviation performance is an important cog in modern globalized economies, which demand flexibility, mobility, efficiency, and dependability. Airport delays have gone from being a nuisance to being a salient public concern, drawing the ire of even the White House. In this important book, international transportation experts compare and contrast how different nations have managed their airports and air traffic control systems and how well they are meeting the needs of their people. The book's cross-national approach encompasses several different institutional arrangements, making it a timely and valuable study in comparative political economy. Among the countries studied, the United States is sometimes seen as a bastion of free markets, at the forefront of airline deregulation, but its airports and air traffic control system are publicly owned and operated. The same is true in continental Europe, for the most part. In contrast, Australia, New Zealand, the United Kingdom, and Canada are experimenting with privatization, while even mainland China is allowing the private sector to participate in airport ownership. Which methods work best, and under what circumstances? This book provides the answers.

    eISBN: 978-0-8157-9396-0
    Subjects: Transportation Studies

Table of Contents

  1. Front Matter
    (pp. i-iv)
  2. Table of Contents
    (pp. v-viii)
  3. 1 Introduction
    (pp. 1-4)

    The increasing interdependence of firms and individuals throughout the world—popularly defined as globalization—has been greatly facilitated by air transportation. In 2005 the world’s airlines carried roughly 2 billion passengers, more than one-third of whom were traveling for business or pleasure to another country. For the next several years, the world’s air traffic is expected to grow about 6 percent annually.¹

    Globalization can enable a nation to develop and benefit from its comparative advantage in commodities and services including tourism, but a nation must have adequate infrastructure to realize its comparative advantage. For example, a country must have a...

  4. PART ONE The United States and Continental Europe

    • 2 Delayed! U.S. Aviation Infrastructure Policy at a Crossroads
      (pp. 7-35)

      In the aftermath of the September 11 terrorist attacks, travelers’ fears of flying have given way to their anxieties about delays they may encounter when going through airport security, leaving the departure gate and taking off, flying to their destination, and landing and disembarking from the aircraft. In 2005 in-flight delays and earlier airport arrivals for security screening were estimated to cost passengers and airlines in the United States $40 billion annually.¹

      Of course, delays are hardly a new concern with airline travel. As shown in figure 2-1, travel times have been increasing for the past three decades. Forecasts by...

    • 3 The European Union: Evolution of Privatization, Regulation, and Slot Reform
      (pp. 36-62)

      Far-reaching changes to the aviation sector in the European Union over the last two decades have included, among other things, deregulation of the airline service sector, the formation of the EU common aviation market, the recent signing of an EU-U.S. open-skies agreement, a gradual move toward airport privatization, and a continuing evolution of airport regulation and slot allocation reform. The goal of this paper is to examine the continental EU experience with changes to economic regulatory policy and capacity allocation through slots (a slot is the right to take off or land at an airport during a specific period of...

  5. PART TWO Australia, New Zealand, the United Kingdom, and Canada

    • 4 Airport Policy in Australia and New Zealand: Privatization, Light-Handed Regulation, and Performance
      (pp. 65-99)

      Australia and New Zealand moved to private ownership of their major airports between 1996 and 1998. After a period of formal price-cap regulation that ran from 1997 to 2002, Australia adopted New Zealand’s use of a light-handed form of regulation. Currently in both countries prices are not explicitly regulated, but regulation could be imposed if performance is considered to be poor. Such a regulatory environment for airports is rare around the world—most regulation is much more prescriptive. Together Australia and New Zealand constitute a useful case study of how light-handed regulation works with airports.

      Under government ownership, a number...

    • 5 Airport Planning and Regulation in the United Kingdom
      (pp. 100-135)

      This chapter investigates the effectiveness of the airport planning and regulatory system in the United Kingdom and assesses the appropriateness of the current ownership structure. The airport industry has shifted from public to private sector ownership over the last twenty years as a result of new policy directions initiated by the desire of the 1980s conservative government to privatize public utilities. At the same time, air traffic growth has been strong, encouraged by a more liberal environment and in particular by the emergence of low-cost carriers (LCCs). Moreover, throughout this period there have been pressures on capacity at airports in...

    • 6 Airport Policy in Canada: Limitations of the Not-for-Profit Governance Model
      (pp. 136-156)

      This paper examines the development of airport investment policy in Canada. Canadian airports were operated as a single system by a federal department that found itself unable to finance needed rates of capacity expansion and renewal. The government decided to quasi-privatize the airport system by transferring individual airports to locally based airport authorities.¹ These authorities were created as private sector companies but with no equity capital. That is, they are not-for-profit corporations. This governance model achieved the government’s aim of increasing investment. (Correspondingly, at the key airports of Toronto and Vancouver, the increased investment resulted in decreased congestion.) To generate...

  6. PART THREE China and Developing Countries

    • 7 Airport Policy and Performance in Mainland China and Hong Kong
      (pp. 159-192)

      China’s airline industry used to be a paramilitary organization—before the 1980s the Civil Aviation Administration of China (CAAC) was a department of the air force. The CAAC not only regulated civil aviation but was directly involved in every aspect of the industry, including airline operation, airport management, and air traffic control. Although civil aviation was effectively separated from the air force in the early 1980s, liberalization of the aviation industry began largely in the late 1980s, when the single CAAC carrier was split into six operationally and financially independent airlines and the entry of non-CAAC carriers was encouraged. The...

    • 8 Air Transportation Infrastructure in Developing Countries: Privatization and Deregulation
      (pp. 193-221)

      The latter years of the twentieth century saw considerable movement toward loosening economic regulation across a wide range of industries. Initiated in higher-income countries, this trend has spread across much of the globe, albeit at different speeds and in a variety of forms. This paper looks at developments in the changing regulatory environments under which airports and associated facilities are provided in developing countries. No firm line is drawn in defining a developing country, but most nations in Africa fall under the rubric, as do many countries in South America and parts of Asia, along with some of the transition...

    • 9 Synthesis and Conclusions
      (pp. 222-224)

      The ultimate question raised by this book concerns the desirability of privatizing aviation infrastructure. Generally, the largest improvements in economic welfare from privatization of public facilities are likely to be generated in environments where privatized entities are subject to intense competition that leads to lower costs and more rapid technological advance. Because many of their air transport corridors experience a large volume of traffic, the United States and continental Europe have the greatest potential for such competition in aviation infrastructure. But surprisingly these regions have shown relatively little interest in privatization—preferring a network of airports and an air traffic...

  7. Contributors
    (pp. 225-226)
  8. Index
    (pp. 227-238)
  9. Back Matter
    (pp. 239-240)