Airline emissions charges and airline networks |
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| Institution: | 1. School of Mathematical Sciences, University of Electronic Science and Technology of China, Chengdu, China;2. School of International Trade and Economics, University of International Business and Economics, Beijing, China;3. School of Economics and Management, Beihang University, Beijing, China;1. School of Economics and Management, Beihang University, Beijing, China;2. National School of Development, Peking University, Beijing, China |
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| Abstract: | Emissions charges are an effective tool to control aviation carbon dioxide emissions. This paper investigates how airline emissions charges affect a monopoly airline's network choice. By considering simultaneously fully-connected, hub-spoke and mixed networks, we find that the impact of emissions charges on airline network configuration depends crucially on some relevant parameters, for example, the marginal benefit of the reduction of schedule delays and the disutility of additional travel time of connecting flights. Welfare analysis shows a discontinuity in the network configuration from the social planner's perspective and an inefficiency related to the airline's choice on mixed network. |
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| Keywords: | Airline emissions charges Airline network Mixed network Welfare analysis |
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