EC6003E - Air Transport Economics

Objectives

General objective:

After completing this module, the student will be able to :
- Appreciate the key factors of provision and demand for Air Transport, in relation to Economics,
- Recognize the cost and price structure of airports and airlines and impact on activities such as pricing and revenue management or aircraft/route/network economics;
- Understand how economic fundamentals influence air transport marketing and strategic choices, impacting industry structure and profitability;
- Take on board the economic rationale of industry, market airline or airport operator regulation;
- Review key principles of air traffic forecasts and data used for statistical modelling.

Detailed objectives:

After completing this module, the student will be able to:
- Relate economic principles and theory to key decisions in air transport at different levels: individual consumer choice, market equilibrium, airline/airport product and marketing, group strategies (alliances, international developments), industry structure, public policy (cost-benefit analysis), international agreements and trade (bi-laterals, free-trade)
- Appreciate economic measurements used for costing and pricing in different settings: aircraft, route, network, airport; apply these to concrete cases to cost a route or flight.
- Understand the trade-offs that aircraft manufacturers do to provide a technical and economic resources to operators; compare different aircraft types in this regard
- Appreciate the economic rationale behind air transport regulation (capacity, prices, frequency, providers), airline or airport strategy, marketing and pricing; investigate how these impact the growth of markets and industries, through concrete examples
- Review air transport policies and infrastructure choices from an economic perspective such as cost-benefit analysis, economic regulation contracts, economic and tourism development
- Recognize critical air transport data and indicators, and use key modeling methods to carry-out forecasts in air transport with this data; review forecasts as done by institutions (ICAO, IATA…)
In the framework of a group case study, apply all the theory, concepts, data and techniques used in the course to make a diagnosis and suggest future outcomes in an air transport context

Form of assessment

Total assessment hours: 2