TABLE OF CONTENTS Is airline hubbing a good thing? There is little doubt that it is good for the competitive position of the individual airline. But is it good overall? Does it produce any positive net benefits, when all the effects on the industry as a whole are taken into account? This is an important issue for public policy: to decide whether government authorities should do anything to prevent or discourage airlines from establishing and building up hubs or whether they should actively encourage hubbing.
This broad question is examined by considering the effects of hubs on:
airline costs: does routeing via hubs have the effect of increasing or reducing the unit costs of operating services?
airports: how do hubs affect the operation of airport facilities?
passengers: what is the net effect of hubs on passenger benefits, when some passengers enjoy gains whilst others lose?
