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Entry Patterns in the Southwest Airlines Route System

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Author Info

  • Charles Boguslaski
  • Harumi Ito
  • Darin Lee

    ()

Abstract

We estimate a model of city-pair entry for Southwest Airlines using data from 1990 to 2000. In addition to quantifying the market characteristics which have influenced Southwest’s entry decisions, we find evidence that Southwest’s entry strategies have changed significantly throughout the decade. Based on our model’s estimates, we provide an estimate of the foregone fare savings resulting from the Wright and Shelby Amendments. Finally, we identify those markets that are the most likely for future non-stop entry and suggest which network carriers are most vulnerable to future Southwest expansion. Copyright Kluwer Academic Publishers 2004

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File URL: http://hdl.handle.net/10.1007/s11151-004-1970-5
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Bibliographic Info

Article provided by Springer in its journal Review of Industrial Organization.

Volume (Year): 25 (2004)
Issue (Month): 3 (08)
Pages: 317-350

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Handle: RePEc:kap:revind:v:25:y:2004:i:3:p:317-350

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Web page: http://www.springerlink.com/link.asp?id=100336

Related research

Keywords: Airlines; low cost carrier; market entry;

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Cited by:
  1. Oliveira, Alessandro V.M., 2008. "An empirical model of low-cost carrier entry," Transportation Research Part A: Policy and Practice, Elsevier, vol. 42(4), pages 673-695, May.
  2. A. Mantovani & O. Tarola, 2006. "Did the entry of low cost companies foster the growth of strategic alliances in the airline industry?," Working Papers 574, Dipartimento Scienze Economiche, Universita' di Bologna.
  3. Du, Yan & McMullen, B. Starr & Kerkvliet, Joe R., 2008. "The economic impact of the ATA/Southwest Airlines code-share agreement," Research in Transportation Economics, Elsevier, vol. 24(1), pages 51-60.
  4. Maria José Gil-Moltó & Claudio A. Piga, 2007. "Entry and Exit in a Liberalised Market," Rivista di Politica Economica, SIPI Spa, vol. 97(1), pages 3-38, January-F.
  5. Jia Yan & Xiaowen Fu & Tae Oum, 2008. "Exploring Network Effects of Point-to-Point Networks: An Investigation of the Spatial Entry Patterns of Southwest Airlines," Working Papers 2008-21, School of Economic Sciences, Washington State University.
  6. Hüschelrath, Kai & Müller, Kathrin, 2011. "Patterns and effects of entry in US airline markets," ZEW Discussion Papers 11-059, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  7. Claudio A. Piga & Enrico Bachis, 2006. "Do Prices grow more in Euroland? Evidence from the Airline Industry," Discussion Paper Series 2006_8, Department of Economics, Loughborough University, revised Nov 2006.
  8. Hüschelrath, Kai & Müller, Kathrin, 2011. "Low cost carriers and the evolution of the US airline industry," ZEW Discussion Papers 11-051, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  9. Hüschelrath, Kai & Müller, Kathrin, 2012. "The value of bluer skies: How much do consumers gain from entry by JetBlue Airways in long-haul US Airline Markets?," ZEW Discussion Papers 12-072, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.

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