Comments on: Aviation econ 101 http://www.26econ.com/aviation-econ-101/ Online economics Fri, 10 Oct 2008 20:58:55 +0000 http://wordpress.org/?v=2.3.2 By: aaron http://www.26econ.com/aviation-econ-101/#comment-219 aaron Mon, 15 Oct 2007 00:06:23 +0000 http://www.26econ.com/aviation-econ-101/#comment-219 A Gerald: Thanks for the perspective. You're right that it's probably due to a combination of factors. A Gerald: Thanks for the perspective. You’re right that it’s probably due to a combination of factors.

]]> By: A Gerald http://www.26econ.com/aviation-econ-101/#comment-216 A Gerald Sun, 14 Oct 2007 14:23:41 +0000 http://www.26econ.com/aviation-econ-101/#comment-216 As an aeronautical engineer, I might suggest that the reason that freight planes are older than passenger planes is down to a combination of passenger choice and aircraft regulations. Passengers don't like getting on old planes, and tend to complain, but freight does not, and passenger comfort is (believe it or not) and very large part of aircraft design. Also, the regulations are much stricter for craft carrying passengers than planes not - imagine if lorries had to pass a different MOT that a car. To lower the cost of each flight, the carrier will factor in the depreciation of the aircraft into the direct operating cost breakdown. By simply converting old airliners, the carrier can lower the DOCs and increase the profit margins. As an aeronautical engineer, I might suggest that the reason that freight planes are older than passenger planes is down to a combination of passenger choice and aircraft regulations. Passengers don’t like getting on old planes, and tend to complain, but freight does not, and passenger comfort is (believe it or not) and very large part of aircraft design. Also, the regulations are much stricter for craft carrying passengers than planes not - imagine if lorries had to pass a different MOT that a car.

To lower the cost of each flight, the carrier will factor in the depreciation of the aircraft into the direct operating cost breakdown. By simply converting old airliners, the carrier can lower the DOCs and increase the profit margins.

]]> By: Koyel http://www.26econ.com/aviation-econ-101/#comment-187 Koyel Thu, 04 Oct 2007 22:22:05 +0000 http://www.26econ.com/aviation-econ-101/#comment-187 You can also email me your response at kmandal@oceanconservancy.org Thanks. Koyel You can also email me your response at kmandal@oceanconservancy.org

Thanks. Koyel

]]> By: Koyel http://www.26econ.com/aviation-econ-101/#comment-186 Koyel Thu, 04 Oct 2007 22:16:07 +0000 http://www.26econ.com/aviation-econ-101/#comment-186 Aaron, I had commented on one of your blogposts a few weeks ago regarding letting markets put resources to their highest valued use. You had given the example of water shortage in your post. I was thinking about that and Florida's "best & highest use" policy for growth management and developement on the coast. In theory, it (putting resources to their highest valued use) worked for a while, condos sprang up like mushrooms, revenues flowed and all was good. Then, there was no public access to the public beach resource, tourism declined, storms took away the beach and required nourishment and/ or armoring, property taxs and insurance rates skyrocketed from the need for high density infrastructure and high risk damages from storms. Except for the waterview from above, none of the attributes that attracted folks there in the first place remained. I suspect that it has something to do with not taking into account "non use" values in valuing the resource. I wanted to make sure if that's true and/or if there are other ways of explaining why the market failed. I would appreciate your response. Thanks much. Koyel Aaron,

I had commented on one of your blogposts a few weeks ago regarding letting markets put resources to their highest valued use. You had given the example of water shortage in your post.

I was thinking about that and Florida’s “best & highest use” policy for growth management and developement on the coast. In theory, it (putting resources to their highest valued use) worked for a while, condos sprang up like mushrooms, revenues flowed and all was good. Then, there was no public access to the public beach resource, tourism declined, storms took away the beach and required nourishment and/ or armoring, property taxs and insurance rates skyrocketed from the need for high density infrastructure and high risk damages from storms. Except for the waterview from above, none of the attributes that attracted folks there in the first place remained.

I suspect that it has something to do with not taking into account “non use” values in valuing the resource. I wanted to make sure if that’s true and/or if there are other ways of explaining why the market failed. I would appreciate your response. Thanks much. Koyel

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