influence of longer intra-state routesin the US. We find that the number of airports serving such routes is some43 percent higher in the US. On a 95 percent confidence interval, we findsuch traffic significantly more con-centrated in the US in comparison toEurope. Although distance suggestslittle influence on such traffic con-centration in Europe, again it adds tospatial concentration in the US. Theresults for long-distance/interconti-nental routes are also surprising:although the US shows some 38 per-cent less airports serving long-dis-tance/ intercontinental routes, con-centration is significantly higher (90 percent CI) in Europe.Also, we foundwith Gini that the distribution of suchroutes across the different airports isthe most even of all, given an averagevalue of 0.745 for AS.These findingsimply a strong national approachwithin the European ‘Union’. Asexpected, distance does not stress thedifference in concentration between both geographical areas due to thenature of the route. One importantconclusion is that European airporthubs depend much more on long-dis-tance/intercontinental routes, whereasspatial concentration in the US seemsinduced internally (domestically),and is able to take advantage of, onaverage, longer distances.
Clustering Airline Networks intoStrategic Groups
The economic agents that determinethese traffic distributions are, of course, the various airline operators.The networks that they operate differ from each other – grouping themalong network features [1]into strate-gic groups is an intermediate step thatshows differences in market structure between Europe and the US.When examining the second table indetail, we find a much more fragment-ed market structure in Europe, withvery small networks. At the other extreme, the largest US networks aresignificantly bigger than the Europeanones. There are more very large net-works in the US: the largest 7 carrierseasily outperform the largest 6European in terms of monthly depar-tures from their busiest hubs. Thenumber of average routes per AP issignificantly higher,and these US car-riers show significantly steeper slopes(which indicate a higher spatial con-centration) in traffic distribution aswell. The case around AmericanAirlines shows significantly morelong-distance links than any EU- based airline. More airlinesoperatingsmaller networks in the 7 to 25 APrange can be found in Europe, butthey show a lower tendency towardsspatial concentration. The same num- ber of mid-size carrier networks can be found in the US and Europe (thereare 17 of them in either geographicalarea): European ones show more con-nections, on average, per airport (4.5versus 3.2in the US), although theEuropean ones tend to be lessspatial-ly concentrated at their main airports(showing departures in a range of log(2.79 to 2.96) versus a log(3.25) inthe US). A final distinctive feature for these 17 mid-sized airline networks isthat the US groups show almost nolong-distance links as compared tosignificant intercontinental route serv-ice in the EU.
Decomposition of Route-Typetraffic Distribution alongStrategic Groups
In the final step of our analysis, we cannow highlight how different strategicgroups in both geographical areasmanage traffic for distinct route types,i.e. intra-state/ domestic versus inter-state/ intra-European versus intercon-tinental. Our findings (detailed statisti-cal results can be obtained from theauthor upon request) can be summa-rized as follows.The US geopolitical environmentallowed for the emergence of nationalor even regional hubs that cater to theoperations of mostly large,high densi-ty networks. They serve larger geo-graphic distances on averageand their respective market coverage shows lit-tle overlap with airports that are beingcovered by other strategic groups.Intra-state traffic contributes to higher spatial concentration, which is proba- bly enhanced by distance advantagesin a common market.One may arguethat this configuration is likely to beadopted in Europe as well, given thelonger period for which the US mar-ket has been de-regulated. On theother side, the underlying geo-politi-caldrivers in Europe (for example:national policies by Member States,etc.) are not likely to change soon and
e-zine edition, Issue 38
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Table 2:
Clustering of airline networks into strategic groups
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