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The effect of competition on price discrimination in the international flight market between the U.S. and China

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  • He, Qingxin

Abstract

This research offers new evidence on the relationship between competition and second-degree price discrimination in the airline industry using a unique micro data set on international flight ticket transactions between the U.S. and China. Due to the disaggregated nature of the transaction level data used in this analysis, I am able to precisely measure ticket restrictions/qualities and offer some plausible explanations for the restriction-specific effects of market competition on price discrimination. Overall, the results suggest that there is a negative relationship between price discrimination and market competition, which is consistent with the traditional wisdom that the ability to price discriminate will be deteriorated by less market concentration.

Suggested Citation

  • He, Qingxin, 2016. "The effect of competition on price discrimination in the international flight market between the U.S. and China," Economics of Transportation, Elsevier, vol. 7, pages 1-23.
    • Handle: RePEc:eee:ecotra:v:7-8:y:2016:i::p:1-23
    DOI: 10.1016/j.ecotra.2016.10.001
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    References listed on IDEAS

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    Cited by:

    1. Lewis, Matthew S., 2021. "Identifying airline price discrimination and the effect of competition," International Journal of Industrial Organization, Elsevier, vol. 78(C).
    2. Su, Min & Luan, Weixin & Sun, Tianyao, 2019. "Effect of high-speed rail competition on airlines’ intertemporal price strategies," Journal of Air Transport Management, Elsevier, vol. 80(C), pages 1-1.

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    More about this item

    Keywords

    L11; L93; Price discrimination; Market structure; Airline industry;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation

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