IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/74502.html
   My bibliography  Save this paper

Analysis of the lowest airfares considering the different business models of airlines, the case of Budapest

Author

Listed:
  • Dudás, Gábor
  • Boros, Lajos
  • Pál, Viktor
  • Pernyész, Péter

Abstract

This study reports the findings of a research that compared the lowest airfares of full-service network carriers and low-cost airlines and mapped the cost distance between Budapest and European cities. The study investigated return air tickets for three time periods in 48 European cities for travellers who originated from Budapest. The study was based on quantitative research methods using automated internet data collection and a unique GIS-based mapping method to compare airfares and visualise the cost distance between European cities and Budapest. Our findings showed that low-cost airlines outperform full-service network carriers by offering lower-fare air tickets, while the cost distance maps showed that cities accessible by low-cost airlines are ‘closer’ to Budapest in general.

Suggested Citation

  • Dudás, Gábor & Boros, Lajos & Pál, Viktor & Pernyész, Péter, 2016. "Analysis of the lowest airfares considering the different business models of airlines, the case of Budapest," MPRA Paper 74502, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:74502
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/74502/1/MPRA_paper_74502.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Frédéric Dobruszkes, 2014. "Geographies of European Air Transport," ULB Institutional Repository 2013/174043, ULB -- Universite Libre de Bruxelles.
    2. Frédéric Dobruszkes, 2006. "An analysis of European low-cost airlines and their networks," ULB Institutional Repository 2013/95835, ULB -- Universite Libre de Bruxelles.
    3. Frédéric Dobruszkes, 2013. "The geography of European low-cost airline networks: A contemporary analysis," ULB Institutional Repository 2013/135954, ULB -- Universite Libre de Bruxelles.
    4. Klophaus, Richard & Conrady, Roland & Fichert, Frank, 2012. "Low cost carriers going hybrid: Evidence from Europe," Journal of Air Transport Management, Elsevier, vol. 23(C), pages 54-58.
    5. Rey, Belén & Myro, Rafael L. & Galera, Asun, 2011. "Effect of low-cost airlines on tourism in Spain. A dynamic panel data model," Journal of Air Transport Management, Elsevier, vol. 17(3), pages 163-167.
    6. Graham, Anne & Dennis, Nigel, 2010. "The impact of low cost airline operations to Malta," Journal of Air Transport Management, Elsevier, vol. 16(3), pages 127-136.
    7. Dobruszkes, Frédéric, 2009. "New Europe, new low-cost air services," Journal of Transport Geography, Elsevier, vol. 17(6), pages 423-432.
    8. Suau-Sanchez, Pere & Burghouwt, Guillaume, 2011. "The geography of the Spanish airport system: spatial concentration and deconcentration patterns in seat capacity distribution, 2001–2008," Journal of Transport Geography, Elsevier, vol. 19(2), pages 244-254.
    9. Dobruszkes, Frédéric, 2013. "The geography of European low-cost airline networks: a contemporary analysis," Journal of Transport Geography, Elsevier, vol. 28(C), pages 75-88.
    10. Lijesen, Mark G. & Rietveld, Piet & Nijkamp, Peter, 2002. "How do carriers price connecting flights? Evidence from intercontinental flights from Europe," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 38(3-4), pages 239-252, May.
    11. Frédéric Dobruszkes, 2009. "New Europe, new low-cost air services," ULB Institutional Repository 2013/95851, ULB -- Universite Libre de Bruxelles.
    12. Bilotkach, Volodymyr, 2010. "Reputation, search cost, and airfares," Journal of Air Transport Management, Elsevier, vol. 16(5), pages 251-257.
    13. Garrigos-Simon, Fernando J. & Narangajavana, Yeamduan & Gil-Pechuan, Ignacio, 2010. "Seasonality and price behaviour of airlines in the Alicante-London market," Journal of Air Transport Management, Elsevier, vol. 16(6), pages 350-354.
    14. Pels, Eric & Rietveld, Piet, 2004. "Airline pricing behaviour in the London–Paris market," Journal of Air Transport Management, Elsevier, vol. 10(4), pages 277-281.
    15. Pels, Eric, 2008. "Airline network competition: Full-service airlines, low-cost airlines and long-haul markets," Research in Transportation Economics, Elsevier, vol. 24(1), pages 68-74.
    16. Bilotkach, Volodymyr & Mueller, Juergen & Németh, Adél, 2014. "Estimating the consumer welfare effects of de-hubbing: The case of Malév Hungarian Airlines," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 66(C), pages 51-65.
    17. Malighetti, Paolo & Paleari, Stefano & Redondi, Renato, 2009. "Pricing strategies of low-cost airlines: The Ryanair case study," Journal of Air Transport Management, Elsevier, vol. 15(4), pages 195-203.
    18. Budd, Lucy & Francis, Graham & Humphreys, Ian & Ison, Stephen, 2014. "Grounded: Characterising the market exit of European low cost airlines," Journal of Air Transport Management, Elsevier, vol. 34(C), pages 78-85.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dobruszkes, Frédéric, 2013. "The geography of European low-cost airline networks: a contemporary analysis," Journal of Transport Geography, Elsevier, vol. 28(C), pages 75-88.
    2. Alderighi, Marco & Gaggero, Alberto A., 2019. "Flight availability and international tourism flows," Annals of Tourism Research, Elsevier, vol. 79(C).
    3. Jimenez, Edgar & Claro, João & Pinho de Sousa, Jorge & de Neufville, Richard, 2017. "Dynamic evolution of European airport systems in the context of Low-Cost Carriers growth," Journal of Air Transport Management, Elsevier, vol. 64(PA), pages 68-76.
    4. Allroggen, Florian & Wittman, Michael D. & Malina, Robert, 2015. "How air transport connects the world – A new metric of air connectivity and its evolution between 1990 and 2012," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 80(C), pages 184-201.
    5. Laurino, Antonio & Beria, Paolo & Debernardi, Andrea & Ferrara, Emanuele, 2019. "Accessibility to Italian remote regions: Comparison among different transport alternatives," Transport Policy, Elsevier, vol. 83(C), pages 127-138.
    6. Mueller, Falko, 2022. "Examining COVID-19-triggered changes in spatial connectivity patterns in the European air transport network up to June 2021," Research in Transportation Economics, Elsevier, vol. 94(C).
    7. Dobruszkes, Frédéric & Mondou, Véronique & Ghedira, Aymen, 2016. "Assessing the impacts of aviation liberalisation on tourism: Some methodological considerations derived from the Moroccan and Tunisian cases," Journal of Transport Geography, Elsevier, vol. 50(C), pages 115-127.
    8. Dziedzic, Marcin & Njoya, Eric T. & Warnock-Smith, David & Hubbard, Nick, 2020. "Determinants of air traffic volumes and structure at small European airports," Research in Transportation Economics, Elsevier, vol. 79(C).
    9. Jimenez, Edgar & Suau-Sanchez, Pere, 2020. "Reinterpreting the role of primary and secondary airports in low-cost carrier expansion in Europe," Journal of Transport Geography, Elsevier, vol. 88(C).
    10. Castillo-Manzano, José I. & López-Valpuesta, Lourdes & Pedregal, Diego J., 2012. "What role will hubs play in the LCC point-to-point connections era? The Spanish experience," Journal of Transport Geography, Elsevier, vol. 24(C), pages 262-270.
    11. Stephen Pratt & Markus Schuckert, 2019. "Economic impact of low-cost carrier in a saturated transport market: Net benefits or zero-sum game?," Tourism Economics, , vol. 25(2), pages 149-170, March.
    12. William O’Brochta, 2017. "International tourism’s impact on regional autonomy," Tourism Economics, , vol. 23(8), pages 1632-1661, December.
    13. Wong, Wai-Hung & Zhang, Anming & Cheung, Tommy King-Yin & Chu, Jeremy, 2019. "Examination of low-cost carriers' development at secondary airports using a comprehensive world airport classification," Journal of Air Transport Management, Elsevier, vol. 78(C), pages 96-105.
    14. Dobruszkes, Frédéric & Givoni, Moshe & Vowles, Timothy, 2017. "Hello major airports, goodbye regional airports? Recent changes in European and US low-cost airline airport choice," Journal of Air Transport Management, Elsevier, vol. 59(C), pages 50-62.
    15. Fageda, Xavier & Suau-Sanchez, Pere & Mason, Keith J., 2015. "The evolving low-cost business model: Network implications of fare bundling and connecting flights in Europe," Journal of Air Transport Management, Elsevier, vol. 42(C), pages 289-296.
    16. Vieira, José & Câmara, Gualter & Silva, Francisco & Santos, Carlos, 2019. "Airline choice and tourism growth in the Azores," Journal of Air Transport Management, Elsevier, vol. 77(C), pages 1-6.
    17. à lvarez-Díaz, Marcos & González-Gómez, Manuel & Otero-Giráldez, María Soledad, 2019. "Low cost airlines and international tourism demand. The case of Porto's airport in the northwest of the Iberian Peninsula," Journal of Air Transport Management, Elsevier, vol. 79(C), pages 1-1.
    18. Budd, Lucy & Francis, Graham & Humphreys, Ian & Ison, Stephen, 2014. "Grounded: Characterising the market exit of European low cost airlines," Journal of Air Transport Management, Elsevier, vol. 34(C), pages 78-85.
    19. Voltes-Dorta, Augusto & Rodríguez-Déniz, Héctor & Suau-Sanchez, Pere, 2017. "Passenger recovery after an airport closure at tourist destinations: A case study of Palma de Mallorca airport," Tourism Management, Elsevier, vol. 59(C), pages 449-466.
    20. Dobruszkes, Frédéric & Mondou, Véronique, 2013. "Aviation liberalization as a means to promote international tourism: The EU–Morocco case," Journal of Air Transport Management, Elsevier, vol. 29(C), pages 23-34.

    More about this item

    Keywords

    airfare; low-cost airline; cost distance; air transport; GIS;
    All these keywords.

    JEL classification:

    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:74502. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.