Efficiency and Environment in the Aviation Sector

The research carried out in this thesis contributes in the assessment of aviation efficiency in presence of environmental impacts. The thesis is composed by three works describing: (i) the assessment of airport efficiency considering the production of pollution, (ii) a new comprehensive methodology to compute an economic environmental benchmarks and (iii) the analysis of the current aircraft global market with a computation of effective incentives to move towards greener fleets. In the first paper a hyperbolic distance function model has been applied for airport efficiency assessment considering local air pollution as undesirable output. In order to include the negative externalities connected to local air pollution, we created an index describing the total amounts of pollutants produced for each Italian airport included in our data set. We show that, if the undesirable outputs are ignored, airport efficiency scores can be misleading. In the second paper, a new methodology taking into account economic and environmental variables is developed. We present an additive model that benchmarks the decision making units (DMUs) on a unique eco-environmental frontier considering the production of both good and bad outputs productions. Our directional economic environmental distance (DEED) function describes the distance of each DMU to the efficient frontier evaluating it as potential monetary saving achievable by reaching such frontier. Finally, in the third paper we identify the trade-offs that exist between the noise and air pollution generated by the existing aircraft-engine combinations. Furthermore, we apply the benchmarks resulting from directional economic environmental distance function in order to design a relatively efficient aircraft-engine fleet that could operate at Stockholm and Amsterdam airports given current technology and service levels.