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Proquest Dissertations INFORMATION TO USERS This manuscript has been reproducad from the microfilm master. UMI films the text directly from the original or copy submitted. Thus, some thesis and dissertation copies are in typewriter face, while others may t>e from any type of computer printer. The quality of this reproduction ie dependent upon the quality of the copy submitted. Broken or indistinct print, colored or poor quaO^illustFatidns and photographs, print bleodthrough, sut>standard margins, arxl improper alignment can adversely affect reproduction. In the unlikely event that the author did not send UMI a complete manuscript and there are missing pages, these will be noted. Also, if unauthorized copyright material had to be removed, a note will indicate the deletion. Oversize materials (e.g., maps, drawings, charts) are reproduced by sectioning the original, beginning at the upper left-hand comer and continuing from left to right in equal sections with small overlaps. Photographs included in the original manuscript have treen reproduced xerographically in this copy. Higher quality 6” x 9” black and white photographic prints are available for any photographs or illustrations appearing in this copy for an additional cfiarge. Contact UMI directly to order. Bell & Howell Information and Leaming 300 North Zeeb Road, Ann Arbor. Ml 48106-1346 USA 800-521-0600 UMI* AIR PASSENGER ROUTES IN HUB AND SPOKE NETWORKS DISSERTATION Presented in Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy in the Graduate School of The Ohio State University By Wei Song, M.S., M.A. ***** The Ohio State University 2000 Dissertation Committee Approved by Professor Morton O'Kelly, Adviser Professor Lawrence Brown ^ Adviser ^ Professor Randall Jackson Department of Geography UMI Number 9962454 UMI UMI Microform9962454 Copyright 2000 by Bell & Howell Information and Leaming Company. All rights reserved. This microform edition is protected against unauthorized copying under Title 17, United States Code. Bell & Howell Information and Leaming Company 300 North Zeeb Road P.O. 80x1346 Ann Arbor, Ml 48106-1346 ABSTRACT During the decades following airline deregulation, domestic airline industry has undergone significant structural and operational change. Major airlines have converted from linear structures to national hub and spoke network. While many efforts have been made to examine the network point of view of the hub and spoke network, there are still open questions about passenger behavior in hub-based airline networks. This research is focused on the following aspects of the airline hub and spoke network and operations based on aggregate passenger data: (1) routing structure, (2) aggregate market share, (3) price variations, and (4) inconvenience of travel in the hub and spoke network. The development and expansion of hub and spoke structure are results of the efforts of airlines to pursue network economies. Passenger benefits of hub and spoke route system lie in such service aspects as increased number of city pairs served, more frequent and direct flights from hubs, and ease of online transfers. Diseconomies of travel distance, congestion and delay at hubs, and monopoly air fare are ii primary unfavorable impacts. Chi-square based statistical analyses are performed to test the interdependence between routings and city-pair distance, and quantify the strength of the association. It is shown that at an aggregate level, airline markets are strongly dominated by direct routes, especially in short-haul markets. However, in long haul markets one stop routes could gain a significant passenger share. Post-deregulation air fare variations are examined in relation to routings and departure aiirports. Large fare disparities are found between long-haul eind short-haul routes, between direct and stopped routes in the markets of similar stage length, between flights departing from different airports, and also between flights departing from the same airport at various times. A logit aggregate passenger route model is developed to examine the influences of the following route attributes in the hub network: air fare, travel time en route, waiting time at hubs, activity level of hub airport, and the number of stops on a route. Route elasticities in response to air fare and travel time, as well as values of travel time and waiting time are also derived. A highly diversified and complicated route structure is revealed by Atlanta-based routes based on which the logit model is calibrated. While the general ill preference of passengers for direct routes of low fare and short distance is demonstrated by the consistent estimates of air fare, travel time and number of stops, the impacts of waiting time and hub activity level vary largely. The route elasticities and values of travel time and waiting time also exhibit variations with respect to routing, stage length, and hub airports. IV Dedicated to my parents and my family ACKNOWLEDGMENTS I wish to express my heartfelt gratitude to my academic advisor. Professor Morton O'Kelly, for his untiring guidance, encouragement, and support. His constructive advice and invaluable insights guided me throughout my graduate study auid dissertation research. The completion of this research would not be possible if it wasn't for him. He not only is the best advisor I have ever had, but also serves as a model of scholar for his rigidity and devotion to academic work. I am also grateful for Professor Lawrence Brown, Professor Randall Jackson and Professor Marc Posner for their comments and suggestions. I would also like to thank my colleagues in the Geography Department at University of Wisconsin-Parkside, Professor Chelvadurai Manogaran, Professor Curtis Richards, and Professor Richard Walasek, for their ongoing support. I am also grateful to my friends at The Ohio State University and at University of Wisconsin-Parkside for their constant encouragement and support. VI I am greatly indebted to my parents and parents-in-law for their inspiration and unconditional support. Finally, my wife, Yu Liu, provided much needed encouragement, patience and understanding as this research followed a path that contained many detours. Without her continuing support, this research would have become a formidable task. vu VITA. October 14, 1963 ....... Born - Harbin, China 1987 B.S. Economic Geography, Peking University, China. 1990 M.S. Urban & Regional Studies, Peking University, China. 1992 M.A. Geography, The George Washington University. 1992 - 1996 ............. Graduate Teaching Associate The Ohio State University. 1996 - 1997 ............. Visiting Adjunct Instructor Department of Geography Florida Atlanta University. 1997 - present .......... Assistant Professor Department of Geography University of Wisconsin-Parkside. PUBLICATIONS 1. M. E. O'Kelly, W. Song and G. Shen, "New Estimates of Gravitational Attraction by Linear Programming", Geographical Analysis, Vol. 27, No. 4, October 1995. 2. W. Song, "Urban Waste Economy and Its Evolution Model", Urban Economic Research, No. 5, 1989. viix 3. W . Song, "Urban-Rural Linkage and the Change in Urban Waste Economy in China after 1949", Youth Geographer, Vol.5, No.4, 1989. 4. W. Song and Y. Liu, "Dependent Economy and the Urban Problems in Developing Countries", Urban Problems, No.2, 1989. 5. W. Song, "Trends of the Meaui Center Transferring in Urban Distribution of China", Urban Problems, No. 2, 1988. FIELDS OF STUDY Major Field: Transportation Geography Minor Field: Geographic Information Systems (GIS) IX TABLE OF CONTENTS Page Abstract .................................................. ii Dedication ................................................. v Acknowledgments ............................................vi Vita ..................................................... viii List of Tables ...........................................xiii List of Figures .......................................... xv Chapters : 1. Introduction ........................................ 1 1.1 Hub Network Optimization Analysis .........3 1.2 Analysis of the Impact of Hub-and-Spoke Network on Airline Operation .............. 6 1.3 Remarks ................................... 10 2. Economies of Hub-and-Spoke Network and Implications ............................................... 14 2.1 Economies of Airline Hub-and-Spoke Network ................................... 14 2.1.1 Economies of Traffic Density ............. 16 2.1.2 Economies of Network Structure ........... 20 2.1.3 Economies of Hub-and-Spoke Network ...... 22 2.2 Air Travel and Convenience Considerations ............................ 24 2.2.1 Demand for Scheduled Air Travel ..........25 2.2.2 Convenience of Scheduled Air Service 28 2.3 Implications of Airline Hub-and-Spoke Network for Air Passengers ............... 32 2.3.1 Passenger Benefits ....................... 32 2.3.2 Diseconomies of Route Distance ...........36 2.3.3 Congestion and Delay at Hubs ............. 37 2.3.4 Airline Hub Dominance auid Monopoly Price ..................................... 41 2.4 Remarks .................................... 42 3. Direct or Stopped Trips: Relationship between Routing and Origin-Destination Distance .................. 45 3.1 Air Passenger Database .................... 46 3.2 Routing by Origin-Destination Distance .................................. 49 3.3 A Correspondence Analysis of the Association between Routing and 0-D Distance .............................. 55 3.4 Origin Airports : Will They Make a Difference in Routing? ................... 60 3.5 Remarks ...................................
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