Service-quality and pricing strategies in the airline industry: The role of distance

This paper analyzes airlines's fare and frequency decisions, both theoretically and empirically. These decisions depend on route distance, as only short-haul routes are affected by intermodal competition from personal transportation. Although fares increase with distance both on short- and long...

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Detalles Bibliográficos
Autores: Fageda, Xavier, 1975-, Flores-Fillol, Ricardo
Tipo de recurso: artículo
Estado:Versión aceptada para publicación
Fecha de publicación:2024
País:España
Institución:Varias* (Consorci de Biblioteques Universitáries de Catalunya, Centre de Serveis Científics i Acadèmics de Catalunya)
Repositorio:Recercat. Dipósit de la Recerca de Catalunya
OAI Identifier:oai:recercat.cat:2445/219124
Acceso en línea:https://hdl.handle.net/2445/219124
Access Level:acceso abierto
Palabra clave:Transport aeri
Política de preus
Planificació estratègica
Commercial aeronautics
Prices policy
Strategic planning
Descripción
Sumario:This paper analyzes airlines's fare and frequency decisions, both theoretically and empirically. These decisions depend on route distance, as only short-haul routes are affected by intermodal competition from personal transportation. Although fares increase with distance both on short- and long-haul routes, the effect of distance on frequencies depends on the presence of intermodal competition. Frequencies decay with distance on long-haulroutes. However, on short-haul routes, frequencies increase with distance because airlines try to boost profits by attracting demand from other transportation modes. Finally, on short-haul routes, intermodal competition from personal transportation affects more intensively network carriers than low-cost carriers as distance rises, which produces an increased differentiation between both types of airlines