Open Access. Powered by Scholars. Published by Universities.®
Social and Behavioral Sciences Commons™
Open Access. Powered by Scholars. Published by Universities.®
Articles 1 - 2 of 2
Full-Text Articles in Social and Behavioral Sciences
A General Framework For Price Regulation Of Airports, Sock Yong Phang
A General Framework For Price Regulation Of Airports, Sock Yong Phang
Research Collection School Of Economics
Price cap regulation (PCR) was first implemented for privatized utilities in the UK in the 1980s. It has since been adopted by numerous countries as a regulatory regime in several sectors. This paper focuses on the development of different forms of price regulation of airports of which PCR is one variant. In countries where airport privatization is still in the early stages, the spectrum of airports and varied nature of regulatory regimes can be confusing and the lack of a general framework can itself become an obstacle to privatization. This paper proposes a general framework comprising decisions to be made …
Quantity Discounts And Capital Misallocation In Vertical Relationships, Ken Onishi
Quantity Discounts And Capital Misallocation In Vertical Relationships, Ken Onishi
Research Collection School Of Economics
I study transactions between aircraft manufacturers and airlines as well as airlines' utilization of their fleet. Aircraft production is characterized by economies of scale via learning-by-doing, which creates a trade-off between current profit and future competitive advantage in the aircraft market. The latter consideration makes large buyers more attractive than small buyers and induces quantity discounts. The resulting nonlinear pricing strategy may distort both production and allocation in favor of large buyers. In the data, there is a negative correlation between the size of aircraft orders and the per-unit price, and a positive correlation between the price paid and the …