Competition between airports with an application to the state of Baden-Württemberg

Abstract

Classical theories of competition in two-dimensional space mainly deal with the questions of where firms locate in the plane and what shape their market areas willconsequently adopt. Out of that develops the construct of catchment areas. As part of long-term infrastructure equipment, an airport can not change location. Once it is chosen and operational, an airport has to compete for passengers and market share on basis of its prevailing catchment areas. Passenger choice determines the shape of an airport?s market and these markets, other than in the presented theories, commonly overlap. On the basis of passengers? selection criterions, the valuation of an airport?s attraction takes place. The developed procedure is applied to the state of Baden-Württemberg. It paints a picture of airport competition in the German Southwest. In order to get a sharper image, the formed catchment areas are subdivided into zones of different competition intensity.