arXiv subjects

Alessandro V. M. Oliveira

Publications and source records attributed to Alessandro V. M. Oliveira.

24 records · Page 2Linked to original sources

arXiv2024

Intermodal competition in the Brazilian interstate travel market

This paper presents a test of intermodal interaction between coaches and airlines in Brazil in order to check for the efficacy of recent liberalization measures designed to promote competition in both industries. Interstate travel service in the country is heavily provided by coaches, and the system is fully operated by the private sector under public delegation through permits and authorizations. Agency-based regulation was introduced in 2002 along with a price cap regime aimed at enhancing the flexibility to change fares in response to demand and cost conditions. By making use of a reaction function-based model of coach operators' pricing decisions in the interstate travel market, we then estimate the sensitivity of the changes in coach fares to the changes in airline fares in a simultaneous-equation framework. Intermodal interaction among coach operators and airlines is found to be highly significant and probably due to the competition for a small but increasing set of premium, quality-sensitive, coach passengers.

econ.GN↗

arXiv2024

Transporte Aereo: Economia e Politicas Publicas

This book, written in Portuguese, presents a comprehensive analysis of the air transport industry in Brazil, highlighting its vital importance to the country's economy. It explores the sector's complexity, from economic characteristics to interaction with the national aeronautical industry, through the specialization of the workforce and market demand analysis. The book delves into the economic regulation of air transport, tracing the evolution from periods of strict regulation to phases of liberalization and deregulation, and examines market dynamics, focusing on concentration and competitiveness. It also analyzes demand and supply through case studies, investigating everything from tourists traveling within Brazil to the coverage of the national territory and the prices of air tickets. Finally, the book proposes principles for the regulation and public policies of the air sector, emphasizing the priority of the passenger, the business environment, access to air transport, and economic efficiency, culminating in the advocacy for a free market, but with protection for competition and the consumer.

econ.GN↗

arXiv2024

Airline delays, congestion internalization and non-price spillover effects of low cost carrier entry

This paper develops an econometric model of flight delays to investigate the influence of competition and dominance on the incentives of carriers to maintain on-time performance. We consider both the route and the airport levels to inspect the local and global effects of competition, with a unifying framework to test the hypotheses of 1. airport congestion internalization and 2. the market competition-quality relationship in a single econometric model. In particular, we examine the impacts of the entry of low cost carriers (LCC) on the flight delays of incumbent full service carriers in the Brazilian airline industry. The main results indicate a highly significant effect of airport congestion self-internalization in parallel with route-level quality competition. Additionally, the potential competition caused by LCC presence provokes a global effect that suggests the existence of non-price spillovers of the LCC entry to non-entered routes.

econ.GN↗

arXiv2024

An empirical model of fleet modernization: on the relationship between market concentration and innovation adoption in the Brazilian airline industry

The modernization of an airline's fleet can reduce its operating costs, improve the perceived quality of service offered to passengers, and mitigate emissions. The present paper investigates the market incentives that airlines have to adopt technological innovation from manufacturers by acquiring new generation aircraft. We develop an econometric model of fleet modernization in the Brazilian commercial aviation over two decades. We examine the hypothesis of an inverted-U relationship between market concentration and fleet modernization and find evidence that both the extremes of competition and concentration may inhibit innovation adoption by carriers. We find limited evidence associating either hubbing activity or low-cost carriers with the more intense introduction of new types of aircraft models and variants in the industry. Finally, our results suggest that energy cost rises may provoke boosts in fleet modernization in the long term, with carriers possibly targeting more eco-efficient operations up to two years after an upsurge in fuel price.

econ.GN↗

arXiv2024

Airport service quality perception and flight delays: examining the influence of psychosituational latent traits of respondents in passenger satisfaction surveys

The service quality of a passenger transport operator can be measured through face-to-face surveys at the terminals or on board. However, the resulting responses may suffer from the influence of the intrinsic aspects of the respondent's personality and emotional context at the time of the interview. This study proposes a methodology to generate and select control variables for these latent psychosituational traits, thus mitigating the risk of omitted variable bias. We developed an econometric model of the determinants of passenger satisfaction in a survey conducted at the largest airport in Latin America, São Paulo GRU Airport. Our focus was on the role of flight delays in the perception of quality. The results of this study confirm the existence of a relationship between flight delays and the global satisfaction of passengers with airports. In addition, favorable evaluations regarding airports' food/beverage concessions and Wi-Fi services, but not their retail options, have a relevant moderating effect on that relationship. Furthermore, dissatisfaction arising from passengers' interaction with the airline can have negative spillover effects on their satisfaction with the airport. We also found evidence of blame-attribution behavior, in which only delays of internal origin, such as failures in flight management, are significant, indicating that passengers overlook weather-related flight delays. Finally, the results suggest that an empirical specification that does not consider the latent psychosituational traits of passengers produces a relevant overestimation of the absolute effect of flight delays on passenger satisfaction.

econ.GN↗

arXiv2021

Testing the differentiated impact of the COVID-19 pandemic on air travel demand considering social inclusion

The economic downturn and the air travel crisis triggered by the recent coronavirus pandemic pose a substantial threat to the new consumer class of many emerging economies. In Brazil, considerable improvements in social inclusion have fostered the emergence of hundreds of thousands of first-time fliers over the past decades. We apply a two-step regression methodology in which the first step consists of identifying air transport markets characterized by greater social inclusion, using indicators of the local economies' income distribution, credit availability, and access to the Internet. In the second step, we inspect the drivers of the plunge in air travel demand since the pandemic began, differentiating markets by their predicted social inclusion intensity. After controlling for potential endogeneity stemming from the spread of COVID-19 through air travel, our results suggest that short and low-density routes are among the most impacted airline markets and that business-oriented routes are more impacted than leisure ones. Finally, we estimate that a market with 1 per cent higher social inclusion is associated with a 0.153 per cent to 0.166 per cent more pronounced decline in demand during the pandemic. Therefore, markets that have benefited from greater social inclusion in the country may be the most vulnerable to the current crisis.

physics.soc-ph↗