A Benefit-Cost Analysis of Korea's "Advance Passenger Information System"

Author

Chanyoung Lee, University of Kentucky

Year of Publication

2016

College

Martin School of Public Policy and Administration

Date Available

10-30-2017

Advisor

Dr. Glenn Blomquist

Abstract

Since the tragic 9/11 terrorist attack on the United States in 2001, many countries have been following the US's decisions on the introduction of an air security program. At the heart of the program is the Advance Passenger Information System or the API system. Considering major developed countries' stances and related international organizations' efforts toward the API system's advance, it seems that the introduction of the API system is expected to be a necessity or a kind of obligation both to border control agencies and air flight companies in the near future. However, this does not mean that the introduction of the API system is not without criticism or controversy.

The controversy boils down to the questions of "Is it really proven to be effective in increasing air security" or "Do the expected benefits exceed the total related costs?”. This paper is aimed at trying to answer these questions for the Korean API system.

Three major benefits relating to departure, entry and transit management activities will be identified and estimated when possible. As will be shown in detail in the following sections, benefits from consumer convenience make up major share of total calculated benefits. Other values relating to 'qualitative' benefits are hard to calculate; for this reason, those benefits will not be counted into total numerical values. For the cost side of this analysis, personnel costs and system-related costs like user fees and maintenance costs will be considered. Besides these costs, API system establishment costs could also be counted. However, it seems to be hard to separate the API system establishment costs from all other immigration efficiency systems costs. In addition, the initial establishment costs do not look big on the annual basis, since its introduction was more than ten years ago. Private air carriers should also pay their shares of burden for establishing and operating the system. However, getting access to these private business data is limited and technically making calculation works too complex. Therefore, for balanced analysis, this paper only concerns about costs and benefits in the public sectors.

Based upon this analysis, the total net values of the Korean API system reach up to $62,600 in the year of 2015. (The exchange rate-1,200won/dollar- between Korean won and dollar is applied on the basis of March of 2016 when this paper is written).

Recommended Citation

Lee, Chanyoung, "A Benefit-Cost Analysis of Korea's "Advance Passenger Information System"" (2016). MPA/MPP/MPFM Capstone Projects. 255.
https://uknowledge.uky.edu/mpampp_etds/255