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The Uses of the “Temporal-Fares-Offered Curve” in Air Transportation

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  • Button, Kenneth
  • Vega, Henry

Abstract

The increasing use of Internet booking facilities provides analysts with a rich data source of the profile of airline fares offered for a particular service as the time of departure approaches – “temporalfares- offered curves.” This paper offers a critical assessment of this form of analysis. It also reviews the empirical work that has been done using this type of data and synthesizes the information and insights that it can provide on the operations of an airline market. The subjects covered range from pricing strategies of low-cost and legacy carriers under different degrees of competition, to the extent to which there is price leadership in markets, and to ways in which airlines determine faresoffered when their schedules mean that their own services effectively compete with each other.

Suggested Citation

  • Button, Kenneth & Vega, Henry, 2007. "The Uses of the “Temporal-Fares-Offered Curve” in Air Transportation," Journal of the Transportation Research Forum, Transportation Research Forum, vol. 46(2).
    • Handle: RePEc:ags:ndjtrf:206887
    DOI: 10.22004/ag.econ.206887
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    References listed on IDEAS

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    1. Kenneth Button & Alvaro Costa & Carlos Cruz, 2006. "Ability to Recover Full Costs through Price Discrimination in Deregulated Scheduled Air Transport Markets," Transport Reviews, Taylor & Francis Journals, vol. 27(2), pages 213-230, August.
    2. Cristina Barbot, 2006. "Entry and Accommodation in Airline Markets: Easyjet Caught in the Middle on the London-Grenoble Route," CEF.UP Working Papers 0602, Universidade do Porto, Faculdade de Economia do Porto.
    3. Pels, Eric & Rietveld, Piet, 2004. "Airline pricing behaviour in the London–Paris market," Journal of Air Transport Management, Elsevier, vol. 10(4), pages 277-281.
    4. Andreas Antoniou, 1998. "The status of the core in the airline industry: the case of the European market," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 19(1), pages 43-54.
    5. Morrison, Steven A & Winston, Clifford, 1987. "Empirical Implications and Tests of the Contestability Hypothesis," Journal of Law and Economics, University of Chicago Press, vol. 30(1), pages 53-66, April.
    6. Kenneth Button, 2005. "The Economics of Cost Recovery in Transport," Journal of Transport Economics and Policy, University of Bath, vol. 39(3), pages 241-258, September.
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    Citations

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    Cited by:

    1. Pitfield, D.E., 2008. "Some insights into competition between low-cost airlines," Research in Transportation Economics, Elsevier, vol. 24(1), pages 5-14.
    2. Salanti, Andrea & Malighetti, Paolo & Redondi, Renato, 2012. "Low-cost pricing strategies in leisure markets," Tourism Management, Elsevier, vol. 33(2), pages 249-256.
    3. Clark, Robert & Vincent, Nicolas, 2012. "Capacity-contingent pricing and competition in the airline industry," Journal of Air Transport Management, Elsevier, vol. 24(C), pages 7-11.
    4. Mumbower, Stacey & Garrow, Laurie A. & Newman, Jeffrey P., 2015. "Investigating airline customers’ premium coach seat purchases and implications for optimal pricing strategies," Transportation Research Part A: Policy and Practice, Elsevier, vol. 73(C), pages 53-69.
    5. L. Moreno-Izquierdo & A.B. Ramón-Rodríguez & J.F. Perles-Ribes, 2016. "Pricing Strategies of the European Low-Cost Carriers Explained Using Porter's Five Forces Model," Tourism Economics, , vol. 22(2), pages 293-310, April.
    6. Obeng, K., 2008. "Airline daily fare differentiation in a medium-size travel market," Journal of Air Transport Management, Elsevier, vol. 14(4), pages 168-174.
    7. Moreno, Luis & Ramon, Ana & Pedreño, Andrés, 2015. "The Development of Low-cost Airlines and Tourism as a Competitiveness Complementor: Effects, Evolution and Strategies," Journal of Tourism, Sustainability and Well-being, Cinturs - Research Centre for Tourism, Sustainability and Well-being, University of Algarve, vol. 3(4), pages 262-274.
    8. Su, Min & Luan, Weixin & Sun, Tianyao, 2019. "Effect of high-speed rail competition on airlines’ intertemporal price strategies," Journal of Air Transport Management, Elsevier, vol. 80(C), pages 1-1.
    9. Mantin, Benny & Koo, Bonwoo, 2009. "Dynamic price dispersion in airline markets," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 45(6), pages 1020-1029, November.

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