EC6003E - Air Transport Economics

Objectives

General objective:

After completing this module, the student will be able to :
·Aappreciate 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