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Multilateral airline alliances: Balancing strategic constraints and opportunities

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  • Gudmundsson, Sveinn Vidar
  • Lechner, Christian

Abstract

This paper explores multilateral airline alliances through the lenses of structural holes and network closure. The structural holes theory sees network ties as opportunities linking together separate network segments through brokers and weak ties. The opposing view argues that network closure would generate superior “social capital†and thus superior “economic rent†as we would have more trust, reputation and cooperation within a closed group with strong internal ties. We discuss these theories in the context of multilateral airline alliances and argue that the two concepts in combination advance our ability to explain alliance processes in the airline industry.

Suggested Citation

  • Gudmundsson, Sveinn Vidar & Lechner, Christian, 2006. "Multilateral airline alliances: Balancing strategic constraints and opportunities," Journal of Air Transport Management, Elsevier, vol. 12(3), pages 153-158.
    • Handle: RePEc:eee:jaitra:v:12:y:2006:i:3:p:153-158
    DOI: 10.1016/j.jairtraman.2005.11.007
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    References listed on IDEAS

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    1. Gudmundsson, Sveinn Vidar & Rhoades, Dawna L., 2001. "Airline alliance survival analysis: typology, strategy and duration," Transport Policy, Elsevier, vol. 8(3), pages 209-218, July.
    2. Brueckner, Jan K & Whalen, W Tom, 2000. "The Price Effects of International Airline Alliances," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 503-545, October.
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    4. Rhoades, Dawna L. & Lush, Heather, 1997. "A typology of strategic alliances in the airline industry: Propositions for stability and duration," Journal of Air Transport Management, Elsevier, vol. 3(3), pages 109-114.
    5. Jong-Hun Park & Anming Zhang, 2000. "An Empirical Analysis of Global Airline Alliances: Cases in North Atlantic Markets," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 16(4), pages 367-384, June.
    6. Arvind Parkhe, 1991. "Interfirm Diversity, Organizational Learning, and Longevity in Global Strategic Alliances," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 22(4), pages 579-601, December.
    7. David J. Teece, 2003. "Towards an Economic Theory of the Multiproduct Firm," World Scientific Book Chapters, in: Essays In Technology Management And Policy Selected Papers of David J Teece, chapter 15, pages 419-446, World Scientific Publishing Co. Pte. Ltd..
    8. Gudmundsson, Sveinn Vidar & de Boer, Evert R & Lechner, Christian, 2002. "Integrating frequent flyer programs in multilateral airline alliances," Journal of Air Transport Management, Elsevier, vol. 8(6), pages 409-417.
    9. Park, Jong-Hun, 1997. "The effects of airline alliances on markets and economic welfare," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 33(3), pages 181-195, September.
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    Cited by:

    1. Cobeña, Mar & Gallego, à ngeles & Casanueva, Cristóbal, 2019. "Diversity in airline alliance portfolio configuration," Journal of Air Transport Management, Elsevier, vol. 75(C), pages 16-26.
    2. Farooq, Muhammad Shoaib & Salam, Maimoona & Fayolle, Alain & Jaafar, Norizan & Ayupp, Kartinah, 2018. "Impact of service quality on customer satisfaction in Malaysia airlines: A PLS-SEM approach," Journal of Air Transport Management, Elsevier, vol. 67(C), pages 169-180.
    3. Wu, Cheng-Lung & Lee, Andy, 2014. "The impact of airline alliance terminal co-location on airport operations and terminal development," Journal of Air Transport Management, Elsevier, vol. 36(C), pages 69-77.
    4. Piotr Niewiadomski, 2013. "International airline groups in Africa," Global Development Institute Working Paper Series ctg-2013-36, GDI, The University of Manchester.
    5. Schosser, Maximilian & Wittmer, Andreas, 2015. "Cost and revenue synergies in airline mergers – Examining geographical differences," Journal of Air Transport Management, Elsevier, vol. 47(C), pages 142-153.
    6. Heshmati, Almas & C. Kumbhakar, Subal & Kim, Jungsuk, 2016. "Persistent and Transient Efficiency of International Airlines," Working Paper Series in Economics and Institutions of Innovation 444, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.

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