Assignment of Arrival Slots

During inclement weather, the FAA reassigns vacated airport landing slots within a certain time interval. We consider this mechanism design problem when a pre-existing landing schedule defines certain property rights for the airlines. This particular problem has been analyzed from an operational perspective, where the motivation for the FAA's current mechanism-the Compression Algorithm-rests on incentives and property rights. This paper appears to be the first to rigorously formalize these two notions for this application. Our results show that the Compression Algorithm satisfies a certain form of incentive compatibility but fails a certain interpretation of property rights. We then provide an example of a mechanism that satisfies both conditions; proofs of this use a different but related matching model. Neither mechanism, however, would always gvie airlines the incentive to vacate unusable landing slots if airlines can prevent the slot's inclusion in either of these trading algorithms.