module specification

This module introduces and develops the principles of micro and macro - economics needed for understanding the performance of airports and airlines. The module will examine supply and demand analysis, theories of consumer behaviour and theories of airline and airport productivity and performance. It will also introduce the distribution of income, market failure, airline and airport economics including industry benchmarks used to evaluate performance.

The module aims to provide students with:
1. a systematic knowledge and understanding of microeconomic principles, including a critical awareness of economic reasoning;
2. an ability to apply economic principles and analysis within the transport sector.
3. An ability to distinguish between the various airline and airport costs and their impact on profitability.
4. To be able to understand and manipulate data from various sources to assess sector performance.
 
The module also aims to develop students' skills, in particular: academic study skills; IT; literacy; applied analysis; entrepreneurship, critical thinking; interpersonal and team-working; communication, including oral presentation; and problem solving.

Introduction to Microeconomics
Key concepts in economics and an introduction to economic models LO1
Supply and demand analysis, elasticity LO1
Theories of consumer behaviour – economic rationality and its critics LO2
Costs, revenues and profit maximisation LO1,LO3
Theories of the firm: Perfect competition and monopoly LO2,LO4

Introduction to imperfect competition
The distribution of income
Market efficiency and market failure
Introduction to international trade. LO

Transport Economics
Scope of economics as it relates to airlines LO1,LO2
The role of the economic system within aviation LO1,LO2
Economic failures LO2,LO4
Market equilibriums LO3
Cost and production analysis LO3
International economics and aviation LO2,LO4
Open skies LO2,LO4
Competitive market structures LO4
Airline and Airport Performance indicators LO4

The formal delivery of the teaching and learning will be based on three contact hours per week. The contact hours will be formed of a three-hour work shop involving lecture/seminar periods. The teaching and learning techniques employed on the module will consist of the following: lectures, guest speakers, case study discussions, panel discussions and debates, film and DVDs, as well as scenario-based activities and simulations.

Within the module there is significant opportunity to participate in proactive learning activities via the use of Weblearn facilities which promote inter-active discussions between both peers and lecturers and enables learners to share resources and access links to external journal articles, websites and other sources.

Discussion and debate are actively encouraged both within the classroom context and via Weblearn. Students participating in this degree come from a variety of backgrounds and often have a wealth of industry experience upon which to draw. It is useful to access this via proactive and inter-active classroom management. Students have a responsibility to prepare for forthcoming lectures so as to ensure that they fully understand the concepts discussed and, so as they can participate fully in debates and discussions. This can be done via accessing the module specifications on-line or via Weblearn and ascertaining the forthcoming weeks lecture content.

Tutors will provide an indication of forthcoming lecture content at the end of each preceding lecture. The student should then research articles and appropriate readings around these themes so as to contribute fully to discussions and inter-active Question and Answer sessions within the lecture.

Opportunities for reflective learning will be available throughout the module as students are given the opportunity to consider their approach to tasks and discussions whilst simultaneously having the opportunity to reflect upon informal feedback that may be given from lecturers on ideas and concepts spoken of in class and, on assessments submitted.

On successful completion of this module, students will be able to:
1. Apply knowledge of basic microeconomic concepts such as opportunity cost, elasticity, economic profit and marginal analysis in coursework and examination problems and be able to explain these concepts from first principles;
2. Analyse and evaluate responses to various economic problems as it applies to the transport industry, recognising the existence of different practical and theoretical approaches to policy questions.
3. Understand various cost structures and their implications on load factors
4. Demonstrate an understanding of competition and key performance indicators.

The assessment for this module will take the form of four assessments. The first assessment will cover LO1 and will take the form of an essay in which student will demonstrate their ability to understand the basics of economic theory. Assessment two will cover the application of such theories in a real-world scenario based environment. Assessment three will be an in-class test to elicit the students understanding of the various cost components within the sector. The last assessment looks into how organisations within the sector use Key performance indicators to evaluate performance.

Key Texts

Holloway, S. (2016), Straight and Level. Practical Airline Economics. 4th Edition. Routledge
Cowe, T. (2018). Modern Principles of Economics. 4th Edition. Worth.
Mankiw, G. (2015) Macroeconomics. Worth
Vasigh, B. et al. (2016). Introduction to Air Transport Economics- From Theory to Applications.2nd Edition. Routledge

Ancillary Texts
Mankiw, N.G. and Taylor, M.P. (2011) Economics, 2nd Edition, South-Western Cengage Learning
Sloman, J., Wride, A and Garratt, D. (2012), Economics, 8th edition, Prentice Hall
Begg D., Fischer S, Dornbusch R., (2008), Economics, 9th ed., McGraw Hill
Frank, R.H. (2008), The Economic Naturalist: Why Economics Explains Almost Everything, Virgin
Akerlof, G.A. and Shiller, R.J., (2009) Animal Spirits, Princeton

Online resources:
http://veconlab.econ.virginia.edu  games / experiments
www.projects.exeter.ac.uk/feele  games / experiments
www.dirkmateer.com film clips
serc.carleton.edu/econ
iata.org
icao.org
aci-europe.org
Other online resources at www.economicsnetwork.ac.uk