Measuring Conduct and Cost Parameters in the Spanish Airline Market
AbstractThis paper examines airline competition through an empirical specification of a demand and pricing equation system. The system is estimated for the Spanish airline market using a simultaneous procedure. The suitability of the Cournot assumption is tested in a competitive scenario characterized by an asymmetric oligopoly with capacity constraints. In addition, the degree of density economies is analyzed. Results show that Spanish airlines behave in a less competitive way than is implied by the Cournot solution. Finally, some evidence on the fact that thin routes can be considered as natural monopolies is found. Copyright Springer 2006
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Bibliographic InfoArticle provided by Springer in its journal Review of Industrial Organization.
Volume (Year): 28 (2006)
Issue (Month): 4 (June)
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Web page: http://www.springerlink.com/link.asp?id=100336
oligopoly; air transportation; multiple equation models; D43; L13; L93; C30;
Other versions of this item:
- Xavier Fageda, 2005. "Measuring Conduct And Cost Parameters In The Spanish Airline Market," Industrial Organization 0511011, EconWPA.
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
- C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General
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