Operational and financial performance of Italian airport companies: A dynamic graphical model. (November 2016)

• Record Type: Journal Article
• Authors: Abbruzzo, Antonino; Fasone, Vincenzo; Scuderi, Raffaele
• Is Part Of: Transport policy. Volume 52(2016)
• Page Start: 231
• Page End: 237
• Publication Date: 2016-11
• Subjects: Financial indicators -- Operational indicators -- Italy -- Gaussian graphical model; Transportation and state -- Periodicals; Transportation -- Rates -- Periodicals; 388
• DOI: 10.1016/j.tranpol.2016.09.004
• Languages: English
• ISSNs: 0967-070X

Abstract

Abstract: This paper provides evidence on the relationship within a set of financial and operational indicators for Italian airports over 2008–2014. The limited sample size of national and regional airports suggests to apply the penalised RCON ( V, E ) model, which falls within the class of Gaussian graphical models. It provides both estimate and easy way to visualise conditional independence structures of the variables. Moreover, it is particularly suitable for handling longitudinal data where small number of units and huge number of variables have been collected. Findings highlight that a qualified concept of size matters in determining good financial performance. Specifically, increasing jointly the number of movements with flights that would attract a high number of passengers may improve both sales profitability and revenues generated by the company's assets. Results suggests that the effect of low cost carrier has been heterogeneous throughout the sample, which may suggest new opportunities to expand the business in order to intercept the consumer surplus of this category of travellers. Abstract : Highlights: Increasingly crucial role of airport management. Focus on Italian airports' financial performance (FP). Analysis of how FP is influenced by operational indicators. Use of RCON ( V, E ), a graphical model suitable for small samples & longitudinal data. Size matters if properly addressed. LCC have no significant influence.