Departmental Research Seminar

Competition and Consumer Welfare in Airport Slot Allocation
I study how the current airport slot allocation mechanism affects airline competition and consumer welfare. Currently, airlines are required to use their slots at least 80% to keep them for next year. My central finding is that this requirement leads airlines to add flights that exacerbate congestion, yet it also intensifies competition on major routes. To show this, I build and estimate a structural model of airline demand and route choice using EU data. My estimates show that while some airports cease to be congested if current usage doesn't affect future slot allocations, such a change reduces consumer welfare due to the reduced competition. Furthermore, even if a social planner reallocates slots to maximize consumer surplus, the rule change still causes a substantial welfare loss. This highlights that reforms prioritizing allocative efficiency over this competitive mechanism risk substantial harm to consumers.

Social Returns to Conservation: Environmental Quality Incentives Program, Cover Crops, and Water Quality in the Midwest

Agricultural runoff significantly contributes to nutrient water pollution, leading to harmful environmental consequences and posing public health risks. Cover cropping (CC), the practice of planting non-cash crops during off-seasons, has gained attention as a conservation strategy to mitigate these impacts. USDA's Environmental Quality Incentives Program (EQIP), the largest working land conservation program in the U.S., has increasingly supported CC adoption through cost-share subsidies. This study assesses the social returns of EQIP in enhancing surface water quality through CC adoption in the Midwest. This paper conducts an event study to quantify the program's effect on CC adoption, using a novel 17-year satellite-derived dataset of field-level CC adoption and exploiting the staggered rollout of EQIP's Mississippi River Basin Healthy Watershed Initiative (MRBI). The estimates reveal that EQIP MRBI increased CC adoption by 1.46 percentage points over an average four-year treatment exposure, with persistent effects beyond program funding. The study then performs panel data analyses, linking CC adoption to harmonized water-quality data and leveraging the variation between upstream and downstream locations. Empirical results show that a one-percentage-point increase in upstream CC adoption share reduces total nitrogen in surface water by 0.88%. Combining both estimates, a back-of-the-envelope calculation yields a benefit-cost ratio of 2.22, which indicates that EQIP CC subsidies deliver substantial water-quality benefits. At the same time, while EQIP subsidies generate persistent adoption of CC, their additionality is limited, underscoring the need for sharper targeting to enhance environmental effectiveness.