Oral's Document - summary
Abstract: This paper uses a model of consumer demand for individual flights to measure the welfare effects of capacity expansion at airports. I estimate consumers' preferences for the characteristics of different flights, including departure time, travel time, and number of stops. This is made possible by combining existing route-level price data with newly collected data on website ticket prices of individual flights. Using this model, it is possible to evaluate the welfare effects of the airline schedule changes that result after an airport expansion. I find that the addition of a new runway at Dallas-Ft Worth in 1996 resulted in large welfare increases to consumers, with the majority of these benefits accruing to passengers in markets with an itinerary that connected through DFW.
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Eric Forister
Graduate School of Business
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