Air services on thin routes: Regional versus low-cost airlines
AbstractAn examination of the impact in the US and EU markets of two major innovations in the provision of air services on thin routes - regional jet technology and the low-cost business model - reveals significant differences. In the US, regional airlines monopolize a high proportion of thin routes, whereas low-cost carriers are dominant on these routes in Europe. Our results have different implications for business and leisure travelers, given that regional services provide a higher frequency of flights (at the expense of higher fares), while low-cost services offer lower fares (at the expense of lower flight frequencies). Keywords: air transportation; regional jet technology; low-cost business model; thin markets. JEL Classification Numbers: L13; L2; L93.
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Bibliographic InfoPaper provided by Universitat Rovira i Virgili, Department of Economics in its series Working Papers with number 2072/179624.
Date of creation: 2011
Date of revision:
Línies aèries; Aviació comercial; 338 - Situació econòmica. Política econòmica. Gestió; control i planificació de l'economia. Producció. Serveis. Turisme. Preus;
Find related papers by JEL classification:
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
- L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-02-20 (All new papers)
- NEP-EUR-2012-02-20 (Microeconomic European Issues)
- NEP-TRE-2012-02-20 (Transport Economics)
- NEP-TUR-2012-02-20 (Tourism Economics)
- NEP-URE-2012-02-20 (Urban & Real Estate Economics)
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