djr45 discusses a New York Times article about congestion Kennedy Airport, in “Auctions: A Potential Solution to the Growing Airport Congestion Epidemic.” Auctions can be used to limit the number of take offs and landings and as result encourage airlines to use less congested airports or fly during off-peak times. The auction solution proposed could also be used to help solved the problem of which plane gets to take off or land ahead of others.

As airport delays and congestion increase it becomes increasingly attractive for executives, corporations and wealthy people to use private planes. At this time the Federal Aviation Administration (F.A.A.) employs a first come first serve policy when assigning runway clearance for take-offs and landings.  This means that a full commercial flight may have to wait on the tarmac while other small private planes take off.   The first come first serve policy makes private flight especially convenient for busy executives and wealthy people. The number of private flights continues to grow and they are beginning to cause congestion in the sky.  As Kennedy International Airport found that there is finite amount of take offs and landings in a given day so too is there a finite amount of space in the sky.  Although there are ways to encourage commercial flights to use alternate airports, private flights often fly to different airports than commercial planes, these small planes still take up space in the sky and it falls on air traffic control to ensure that’s these planes do not collide mid-flight. On any given day the Air Transport Association cites that between 20 to 30 percent of traffic above New York are corporate flights.  There a discrepancy between the congestion that private flight causes and their financial contribution to the air traffic control system; the F.A.A. estimates that private jets account for 16 percent of air traffic, but contribute only 3 percent to the air traffic control system.  To help ease to burden on commercial flights to support the system a Senate Commerce Committee bill last August proposed that every takeoff should be charged 25 dollars.

A second-bid auction for take-off slots could also be used to decrease the present economic attractiveness of private flights.  With an auction, maximum social welfare could be reached between commercial and private flights.  If auctions are used instead of a flat fee the Senate Committee had proposed, market-clearing prices can be achieved based on time of day and airport such that high occupancy flights may have more preference in choosing their takeoff and landing schedules.  An outcome might be that people who value on-time arrivals will fly higher bidding flights which to leave on-time and people who are not on a tight schedule can fly budget flights that bid lower.

References:

http://www.nytimes.com/2007/08/26/weekinreview/26schwartz.html?emc=eta1

http://edition.cnn.com/2007/TRAVEL/business.travel/10/18/executive.pilots/index.html

http://blog.washingtonpost.com/travellog/2007/08/paying_a_fair_share_1.html