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On-line Booking and Revenue Management: Evidence from a Low-Cost Airline

  • Marco Alderighi

    (Universita' della Valle d'Aosta, Italy)

  • Claudio A. Piga

    (Loughborough University UK, RCEA Rimini)

Using unique data on a low-cost airline posted prices and seat availability, this study sheds some light on whether the airline's actual practice of yield management techniques con- forms with some predictions from economic models of peak-load pricing under demand uncertainty. On the one hand, robust support is found to the notion that prices increase as the seat availability decreases; on the other, theoretical models that do not account for stochastic peak-load pricing fail to capture an important source of dispersion in the data.

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Article provided by Rimini Centre for Economic Analysis in its journal Review of Economic Analysis.

Volume (Year): 2 (2010)
Issue (Month): 3 (September)
Pages: 272-286

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Handle: RePEc:ren:journl:v:2:y:2010:i:3:p:272-286
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