Airline Baggage Fees and Airport Congestion

ChangMin Jiang

The University of Manitoba

Time: 14:00-14:40, Dec. 29

Venue：A1-407, Main Building

Abstract

This talk builds a theoretical model to investigate how baggage policies may influence airport congestion. With checked bag fees, we find that the socially optimal levels of passengers and checked bags will not be achieved if the marginal congestion cost caused by security and boarding inefficiencies is larger than the marginal congestion cost caused by airport-side sorting and loading inefficiencies. However, it is possible with bundle pricing. We further show that if airlines can also charge for carry-ons, the market equilibrium levels of passengers, checked bags and carry-ons might also be equal to the socially optimal levels under airline competition.

Brief Biography:

Dr. Changmin Jiang is currently an assistant professor in the Apser School of Business, University of Manitoba. Dr Jiang’s research involves various issues and aspects in transportation economics and policy, with focuses on the interaction between various parties in a transportation system and its policy implication for the regulator. Dr. Jiang work has been published in top tier journals such as Transportation Research Part B: Methodological; Transportation Research Part A: Policy and Practice; and Journal of Business Ethics. He has won several major research grants and awards supported by the federal government of Canada.