An Analysis of the Effects of European Aviation Deregulation on an Airline's Network Structure and Choice of a Primary West European Hub Airport

This paper focuses on the potential capability of specific airports to attract new services and carriers, once European aviation markets are fully deregulated. A network simulation model is developed for an airline operating in a deregulated market, whose economic objectives are profit maximization and market dominance. The model simulates the potential profits that this hypothetical airline can expect if it adopts a hub-and-spoke network with a specific airport as its hub, and sets output and fares so as to maximize profits and deter entry by potential rivals.