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Did the Airline Tariff Publishing Case Reduce Collusion?

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  • Amalia R. Miller

Abstract

In December 1992, the U.S. Department of Justice filed suit against eight major domestic airlines and the Airline Tariff Publishing (ATP) Company in order to reduce opportunities for collusion in the industry. The lawsuit ended with consent decrees limiting the ability of airlines to communicate surreptitiously through the shared fare database. This paper measures the effects of the litigation and its settlement on industry performance, comparing changes in outcomes between market segments that were more and less likely to be affected by the ATP case. Prices fell in response to the investigation but increased following the settlement, while the number of tickets sold in affected markets declined. The importance of multimarket contact also declined and then recovered. The ATP case had at best a temporary effect on airline collusion.

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  • Amalia R. Miller, 2010. "Did the Airline Tariff Publishing Case Reduce Collusion?," Journal of Law and Economics, University of Chicago Press, vol. 53(3), pages 569-586.
    • Handle: RePEc:ucp:jlawec:doi:10.1086/605294
    DOI: 10.1086/605294
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    Cited by:

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    2. Federico Ciliberto & Jonathan W. Williams, 2014. "Does multimarket contact facilitate tacit collusion? Inference on conduct parameters in the airline industry," RAND Journal of Economics, RAND Corporation, vol. 45(4), pages 764-791, December.
    3. Ivaldi, Marc & Petrova, Milena & Urdanoz, Miguel, 2022. "Airline cooperation effects on airfare distribution: An auction-model-based approach," Transport Policy, Elsevier, vol. 115(C), pages 239-250.
    4. Brueckner Jan K. & Picard Pierre M., 2013. "Airline Alliances, Carve-Outs and Collusion," Review of Network Economics, De Gruyter, vol. 12(2), pages 211-227, June.
    5. Clifford Winston, 2013. "On the Performance of the U.S. Transportation System: Caution Ahead," Journal of Economic Literature, American Economic Association, vol. 51(3), pages 773-824, September.
    6. Cruz-García, Paula & Fernández de Guevara, Juan & Maudos, Joaquín, 2021. "Bank competition and multimarket contact intensity," Journal of International Money and Finance, Elsevier, vol. 113(C).
    7. Federico Ciliberto & Jonathan W. Williams, 2010. "Limited Access to Airport Facilities and Market Power in the Airline Industry," Journal of Law and Economics, University of Chicago Press, vol. 53(3), pages 467-495.
    8. Ciliberto, Federico & Williams, Jonathan, 2010. "Does Multimarket Contact Facilitate Tacit Collusion? Inference on Conjectural Parameters in the Airline Industry," MPRA Paper 24888, University Library of Munich, Germany.
    9. Chao Ma, 2019. "Does capital structure differently affect incumbents' responses to entry threat and actual entry?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 28(4), pages 585-613, November.
    10. Aaron Barkley & David P. Byrne & Xiaosong Wu, 2022. "Price effects of calling out market power: A study of the COVID‐19 oil price shock," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 31(4), pages 923-941, November.
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    12. Beomjoon Shim & Ahmed Khwaja, 2017. "The Collusive Effect of Multimarket Contact on Prices: Evidence from Retail Lumber Markets," 2017 Meeting Papers 593, Society for Economic Dynamics.

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