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Differences in Average Prices on the Internet: Evidence from the Online Market for Air Travel

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Author Info
Jihui Chen
Abstract

Using daily ticket price quotes, this article examines whether there are systematic differences in the airfares obtained through different online travel Web sites. I find that after controlling for ticket availability and heterogeneities that affect ticket prices, there is little systematic difference in the average fares. The parity in average fares observed in 2002 data is in contrast to differences as large as 18% documented by Clemons et al. (2002), and stems in part from the fact that airlines directly compete for online travel dollars today, but did not in 1997. (JEL L2) Copyright 2006, Oxford University Press.

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File URL: http://hdl.handle.net/10.1093/ei/cbj040
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Publisher Info
Article provided by Oxford University Press in its journal Economic Inquiry.

Volume (Year): 44 (2006)
Issue (Month): 4 (October)
Pages: 656-670
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Handle: RePEc:oup:ecinqu:v:44:y:2006:i:4:p:656-670

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Find related papers by JEL classification:
L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

Cited by:
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  1. Diego Escobari & Li Gan, 2007. "Price Dispersion under Costly Capacity and Demand Uncertainty," NBER Working Papers 13075, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Anirban Sengupta & Steven Wiggins, 2006. "Airline Pricing, Price Dispersion and Ticket Characteristics On and Off the Internet," Working Papers 06-07, NET Institute, revised Oct 2006. [Downloadable!]
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This page was last updated on 2008-8-24.

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