ABSTRACT
This chapter addresses the economic appraisal of airports. It illustrates a number of economic policy issues that manifest themselves in the economics of investment. The chapter also addresses the appraisal of investments to enlarge a runway. It considers an investment to increase the size and take-off weight of aircraft flying from an airport. The chapter deals with investments aimed at increasing the number of aircraft movements an airport can handle in a given period of time. The aircraft movement capacity of an airport is generally measured in terms of maximum movements at peak hour, rather than number of movements per day. The types of investments may involve improving the capacity of an existing runway by lengthening a parallel taxiway, adding a second parallel taxiway, adding rapid-exit taxiways or upgrading navigational aids. Differences in traffic diversion and operating costs mean that generalised costs change, hence there is room for generated traffic. Indeed, the analysis could be extended by including deterred traffic.
