How Airports Can Get Rid Of Ghost Flights Once And For All

Professor Richard Steinberg, an expert in auctions and internet economics, discusses the growing issue of airport congestion due to the rapid increase in international air transportation demand. He highlights the inefficiency of the current slot allocation system, which allows airlines to retain slots indefinitely if used 80% of the time, leading to wasteful practices like ghost flights. Steinberg suggests that slot auctions could be a more efficient solution, as economic theory and historical data indicate that they would increase airport capacity, reduce flight delays, and lower costs for both airlines and passengers. Steinberg proposes a combinatorial auction procedure called PAUSE (Progressive Adaptive User Selection Environment) to address the winner determination problem, which arises when trying to allocate slots in large auctions. PAUSE operates in stages, allowing airlines to bid on individual slots and then package bids for multiple slots. This approach avoids the need to solve the complex winner determination problem, making it suitable for airport slot auctions of any size. Steinberg emphasizes that introducing a combinatorial auction procedure like PAUSE is crucial now, as insufficient slot capacity and high carbon emissions have reached a critical stage. The PAUSE auction could help address these issues by enabling more efficient use of airport slots and reducing the incentive for ghost flights, ultimately contributing to meeting environmental targets set by ESG rating agencies.

Source: forbes.com
Published on 2024-10-04

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