Factor substitution and complementarity in the Asia airports industry

Publication Type

Journal Article

Publication Date

9-2006

Abstract

This paper measures and analyzes how the substitutability between various factors in Asia airports has changed over the years. Production factors are decomposed into capital and labor to examine the role of outsourcing in the recent years. The results reveal that outsourcing has emerged from being a substitute for labor and a complementary factor to capital in the late 1990s to become a substitute for both labor and capital. Increases in price elasticities and substitutability of labor and capital indicate that airports in Asia have become more adept at reacting to price changes.

Keywords

Elasticities of factor substitutions, Airport operations efficiency, Outsourcing

Discipline

Asian Studies | Operations and Supply Chain Management | Transportation

Research Areas

Operations Management

Publication

Journal of Air Transport Management

Volume

12

Issue

5

First Page

261

Last Page

266

ISSN

0969-6997

Identifier

10.1016/j.jairtraman.2006.07.003

Publisher

Elsevier

Additional URL

https://doi.org/10.1016/j.jairtraman.2006.07.003

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