Airline Economics

This book presents an original empirical investigation of the market structure of airline city pair markets, shedding new light on the workings of competitive processes between firms. Examining a cross-section of US airline city pairs, Tabacco proposes for the first time that the industry can be understood as a natural oligopoly, each airline market being dominated by one to three airline carriers regardless of market size. The author questions the extent to which airlines deliberately prevent head-to-head competition within city pair markets, and draws intriguing conclusions about competitive forces from the observed market structure. Uncovering some of the main corporate strategies of the airline industry, the book is of immediate relevance to industry managers and practitioners, as well as academic economists.

Provides empirical evidence on airline markets as natural oligopolies Questions whether airlines deliberately prevent head-to-head competition within city pair markets Applies two econometric models of entry to analyse market sharing agreements

Autorentext
Giovanni Alberto Tabacco is Assistant Professor of Economics at Swansea University School of Management, UK. Prior to this he worked in the Economics Department of the University of Bologna, Italy. His research interests include industrial organization, experimental economics and competition policy, and competition economics.

Inhalt

1. Introduction.- 2. Airline City Pair Market as Natural Oligopolies.- 3. Market Size, Firm Numbers and Market Share Asymmetry.- 4. Entry and Market Sharing Agreements in the U.S. Airline Industry.- 5. Conclusion.