Airline network structure under demand uncertainty
AbstractIn this paper, we provide another reason that may explain the adoption of the hub-and-spoke network structure in the airline industry. We show that when an airline has to decide on its capacity before the demand conditions are perfectly known, a hub-and-spoke (h&s) network structure by pooling passengers from several markets into the same plane helps the firm to lower its cost of excess capacity in the case of low demand and to improve its capacity allocation in the case of high demand.
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Bibliographic InfoArticle provided by Elsevier in its journal Transportation Research Part E: Logistics and Transportation Review.
Volume (Year): 36 (2000)
Issue (Month): 3 (September)
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Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/600244/description#description
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- Barla, Philippe & Constantatos, Christos, 2005.
"On the Choice between Strategic Alliance and Merger in the Airline Sector: the Role of Strategic Effects,"
Cahiers de recherche
- Philippe Barla & Christos Constantatos, 2006. "On The Choice between Strategic Alliance and Merger in the Airline Sector: The Role of Strategic Effects," Journal of Transport Economics and Policy, London School of Economics and University of Bath, vol. 40(3), pages 409-424, September.
- Barla, Philippe & Constantatos, Christos, 2005. "On the Choice between Strategic Alliance and Merger in the Airline Sector: the Role of Strategic Effects," Cahiers de recherche 0502, Université Laval - Département d'économique.
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"Did the Entry of Low Cost Companies Foster the Growth of Strategic Alliances in the Airline Industry?,"
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- Rafael Moner Colonques & Ricardo Flores Fillol, 2006. "Strategic Effects Of Airline Alliances," Working Papers. Serie AD 2006-06, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Rafael Moner Colonques & Ricardo Flores Fillol, 2005. "Strategic Effects Of International Airline Alliances," Working Papers. Serie AD 2005-15, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Barla, Philippe & Constantatos, Christos, 2005. "Strategic interactions and airline network morphology under demand uncertainty," European Economic Review, Elsevier, vol. 49(3), pages 703-716, April.
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