Ripple Effects of Slot Deregulation: Evidence from Newark Liberty’s 2016 FAA Reclassification

This study is an evaluation of the effect of the FAA’s 2016 decision to remove slot controls at Newark Liberty International Airport by reclassifying it from Level 3 to Level 2. Using flight-level data from 2014–2018, synthetic difference-in-differences, difference-in-differences, and synthetic control are applied in the analysis to estimate the policy’s effects on absorbed, propagated, and generated delays. Results show a clear trade-off. Absorbed delays increased by 6–8 min relative to the counterfactual, while propagated delays rose by 3–4 min, indicating greater tolerance of inbound disruptions and heightened transmission to subsequent flights. In contrast, generated delays declined modestly, by 0.5–1 min, suggesting some improvement in turnaround efficiency. Overall, deregulation reduced the creation of new inefficiencies but amplified existing disruptions across the network. The findings indicate the importance of balancing regulatory flexibility with measures to preserve resilience in congested airport systems.