Handbook

This course covers the economics of airlines. The course starts by introducing students to the language and data of the aviation business. It then analyses the economics of the demand for and supply of airline services. The analysis of demand focuses on the drivers of demand, travel purposes, mode of transport substitution, destination substitution, demand complements and the various price elasticities of demand. The course then analyses the supply-side of the airline business, which involves an investigation of airline revenue in the short and medium runs, airline cost and profitability. Students will investigate the curvature of the airline profit function and how it may be optimised. The course then moves onto additional topics in airline economics such as airline relationships and the economics of oil and jet fuel markets.