AIR DELAY COSTS AND ITS IMPACTS: AIRPORT DEMAND STUDY AND SIMULATION SCENARIOS OF ECONOMIC WELFARE

Abstract

This article purpose to analyze the impact of the costs of flight delays in domestic demand for air transportation. Using as a case study the Salvador Airport, an airport demand model was developed, having been made simulation scenarios of transmission costs to ticket prices in order to assess how a possible loss of competitiveness affects the demand for travel and economic well fare of passengers. The recent rise of new consumers segments meant a stimulus to the air demand especially in the case of a tourist destination and therefore a worsening of the problem on airport infrastructure. The counterfactual scenarios demand considering alternatives price transfers to passengers were built from the parameters estimated by econometric modeling using instrumental variables. The results show that an increase of 1% in the new consumer credit will result in an increase of 0,4603% of demand and an improvement of 1% in the economy will bring an increase of 0,7447% in the number of domestic passengers. The results also show that due to infrastructure problems and consequent combination of increases in crew, fuel and airport tax may reduce consumer welfare by 3,5% to 18,0% in a competition environment and from 12,1% to 25,0% in a duopoly, showing the importance of competition for the passenger's welfare. Keywords: air demand, new consumers, economic welfare, air delays.