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U.S. Air Passenger Service: a Taxonomy of Route Networks, Hub Locations, and Competition

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Author Info

  • Bania, Neil
  • Bauer, Paul W.
  • Zlatoper, Thomas J.

Abstract

In this paper, we analyze the service provided by the 13 largest U.S. passenger airlines to the 100 most populous U.S. metropolitan areas in 1989. We classify the route systems by their nature and geographic scope using a variety of measures based on route-level data. We then identify individual airline hub locations; derive and calculate several measures of the extent of competition on individual routes, for individual airlines, and at the airports in our sample; and analyze relationships among route structure, costs, and subsequent carrier performance. The results show the wide diversity of route networks that existed in the airline industry in 1989--a phenomenon that may help to explain the eventual failure of several major carriers.

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Bibliographic Info

Article provided by Elsevier in its journal Transportation Research Part E: Logistics and Transportation Review.

Volume (Year): 34 (1998)
Issue (Month): 1 (March)
Pages: 53-74

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Handle: RePEc:eee:transe:v:34:y:1998:i:1:p:53-74

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Keywords: airlines hubs competition;

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References

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  1. Morrison, Steven A & Winston, Clifford, 1987. "Empirical Implications and Tests of the Contestability Hypothesis," Journal of Law and Economics, University of Chicago Press, vol. 30(1), pages 53-66, April.
  2. Hurdle, Gloria J, et al, 1989. "Concentration, Potential Entry, and Performance in the Airline Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 38(2), pages 119-39, December.
  3. Borenstein, S., 1991. "The Evolution of U.S. Airline Competition," Papers 389, California Davis - Institute of Governmental Affairs.
  4. Paul W. Bauer & Thomas J. Zlatoper, 1989. "The determinants of direct air fares to Cleveland: how competitive?," Economic Review, Federal Reserve Bank of Cleveland, issue Q I, pages 2-9.
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Citations

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Cited by:
  1. Kathy J. Hayes & Leola B. Ross, 1996. "Is airline price dispersion the result of careful planning or competitive forces?," Working Papers 9607, Federal Reserve Bank of Dallas.
  2. Nakagawa, Dai & Aoyama, Yoshitaka & Ito, Tadashi & Nishizawa, Hiroyuki, 2005. "Assessment of passenger benefits brought about by international airport projects," Transport Policy, Elsevier, vol. 12(6), pages 512-524, November.
  3. Marti­n, Juan Carlos & Román, Concepción, 2003. "Hub location in the South-Atlantic airline market: A spatial competition game," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(10), pages 865-888, December.
  4. Hsu, Chaug-Ing & Wen, Yuh-Horng, 2000. "Application of Grey theory and multiobjective programming towards airline network design," European Journal of Operational Research, Elsevier, vol. 127(1), pages 44-68, November.
  5. Liu, Zhi-Jun & Debbage, Keith & Blackburn, Brendan, 2006. "Locational determinants of major US air passenger markets by metropolitan area," Journal of Air Transport Management, Elsevier, vol. 12(6), pages 331-341.
  6. Juan Martín & Augusto Voltes-Dorta, 2008. "Theoretical Evidence of Existing Pitfalls in Measuring Hubbing Practices in Airline Networks," Networks and Spatial Economics, Springer, vol. 8(2), pages 161-181, September.
  7. Gupta, Gautam & Goodchild, Anne & Hansen, Mark, 2011. "A competitive, charter air-service planning model for student athlete travel," Transportation Research Part B: Methodological, Elsevier, vol. 45(1), pages 128-149, January.
  8. Van Landeghem, H. & Beuselinck, A., 2002. "Reducing passenger boarding time in airplanes: A simulation based approach," European Journal of Operational Research, Elsevier, vol. 142(2), pages 294-308, October.
  9. Chen, Jeng-Fung, 2007. "A hybrid heuristic for the uncapacitated single allocation hub location problem," Omega, Elsevier, vol. 35(2), pages 211-220, April.

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