The Effects of Airline Alliances: What do the Aggregate Data Say? Articles uri icon

authors

  • GAGNEPAIN, PHILIPPE
  • MARIN URIBE, PEDRO LUIS

publication date

  • July 2010

start page

  • 251

end page

  • 276

issue

  • 3

volume

  • 1

International Standard Serial Number (ISSN)

  • 1869-4187

Electronic International Standard Serial Number (EISSN)

  • 1869-4195

abstract

  • We consider an empirical model of worldwide airline alliances that we apply to a large set of companies for the period 1995&-2000. Using observations at the network level, we estimate a cost,
    capacity, and demand system that accounts for cross-price elasticities.
    Our contribution consists in evaluating airlines'
    strategical interactions through the window of firms' network
    interconnections.
    We consider networks coincidences and potential connections
    with all their rivals. The results allow us to classify all company
    pairs as either complements or substitutes. We shed light on
    the fact that many airlines involved in the same alliance are
    potential substitutes.