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A Political Economic Approach to the Domestic Airline Merger Phenomenon

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  • Joseph A. Clougherty

Abstract

The late 1980s witnessed a wave of cross-national domestic airline mergers that met with consistent antitrust policy approval. This paper explains the antitrust-review success of domestic airline mergers by focusing on international competitive effects. These promote the concurrence of private and public interest political forces behind lenient antitrust reviews, thus furthering political support for antitrust approval. The analysis extends Farrell and Shapiro's (1990) framework for analysing the national welfare merit of mergers, in order to encompass international competitive effects. A dual method (quantitative and qualitative) empirical strategy yields supporting evidence for the political economic hypothesis. © The London School of Economics and the University of Bath 2002

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  • Joseph A. Clougherty, 2002. "A Political Economic Approach to the Domestic Airline Merger Phenomenon," Journal of Transport Economics and Policy, University of Bath, vol. 36(1), pages 27-48, January.
    • Handle: RePEc:tpe:jtecpo:v:36:y:2002:i:1:p:27-48
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    Cited by:

    1. Tsygankova, Marina, 2010. "When is a break-up of Gazprom good for Russia?," Energy Economics, Elsevier, vol. 32(4), pages 908-917, July.
    2. Joseph A. Clougherty, 2005. "Industry Trade Balance And Domestic Merger Policy: Empirical Evidence From U.S. Merger Policy For Manufacturing Sectors," Contemporary Economic Policy, Western Economic Association International, vol. 23(3), pages 404-415, July.
    3. Marina Tsygankova, 2007. "When is Mighty Gazprom Good for Russia?," Discussion Papers 526, Statistics Norway, Research Department.
    4. Joseph A. Clougherty, 2003. "Industry Trade-Balance and Domestic Merger Policy: Some Empirical Evidence from the U.S," CIG Working Papers SP II 2003-19, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG).

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