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Dimensions of predatory pricing in air travel markets

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  • Morrison, William G.

Abstract

This paper highlights how particular characteristics of air travel markets impact key dimensions of predatory pricing investigations. The paper suggests that product complementarity, product differentiation and the existence of internally flexible capacity create particular challenges in defining and measuring the extent of predation in air travel markets. These ‘dimensions of predation’ are applied to recent predatory pricing allegations in Germany.

Suggested Citation

  • Morrison, William G., 2004. "Dimensions of predatory pricing in air travel markets," Journal of Air Transport Management, Elsevier, vol. 10(1), pages 87-95.
    • Handle: RePEc:eee:jaitra:v:10:y:2004:i:1:p:87-95
    DOI: 10.1016/j.jairtraman.2003.10.004
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    References listed on IDEAS

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    1. Button, Kenneth, 2003. "Does the theory of the ‘core’ explain why airlines fail to cover their long-run costs of capital?," Journal of Air Transport Management, Elsevier, vol. 9(1), pages 5-14.
    2. Baumol, William J, 1996. "Predation and the Logic of the Average Variable Cost Test," Journal of Law and Economics, University of Chicago Press, vol. 39(1), pages 49-72, April.
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    Cited by:

    1. Cristina Barbot, 2006. "Entry and Accommodation in Airline Markets: Easyjet Caught in the Middle on the London-Grenoble Route," CEF.UP Working Papers 0602, Universidade do Porto, Faculdade de Economia do Porto.
    2. Valido, Jorge & Socorro, M. Pilar & Medda, Francesca, 2020. "Airport capacity and entry deterrence: Low cost versus full service airlines," Economics of Transportation, Elsevier, vol. 22(C).
    3. Diaconu Maxim Laura, 2012. "The Development of the Low-Cost Carriers’ Business Models. Southwest Airlines Case Study," Scientific Annals of Economics and Business, Sciendo, vol. 59(1), pages 231-238, July.
    4. Sun, Xiaoqian & Wandelt, Sebastian & Zhang, Anming, 2023. "Price discrimination through hidden city options? A data-driven study on the extent and evolution of skiplaggability in the global aviation system," Journal of Air Transport Management, Elsevier, vol. 108(C).
    5. Jorge Valido & M. Pilar Socorro & Francesca Medda, 2013. "DYPES: Vertical differentiation, schedule delay and entry deterrence: Low cost vs. full service airlines," Working Papers 2013-05, FEDEA.
    6. Silva, Thiago Christiano & Dias, Felipe A.M. & dos Reis, Vinicius E. & Tabak, Benjamin M., 2022. "The role of network topology in competition and ticket pricing in air transportation: Evidence from Brazil," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 601(C).
    7. Claudio Agostini, 2005. "El Mercado de Transporte Aéreo: Lecciones para Chile de una Revisión de la Literatura," ILADES-UAH Working Papers inv163, Universidad Alberto Hurtado/School of Economics and Business.

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