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Rivalry and forbearance in the European airline industry : Evidence of an inverted U-shaped competitive pattern

Author

Listed:
  • Michel Ghertman

    (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (1965 - 2019) - CNRS - Centre National de la Recherche Scientifique - UniCA - Université Côte d'Azur)

  • Zied Guedri

    (EM - EMLyon Business School)

Abstract

This study develops and tests a theoretical framework which suggests that the relationship between the level of multi-territory (or multi-point) contact and rivalry takes the form of an inverted U-shaped relationship. Drawing on a large sample of European airlines over the period 2001-2006, we provide empirical support for the inverted U-shaped relationship between multi-territory contact and rivalry as reflected by entries into and exits from the territory of a competitor. We conclude that competition between firms exhibits successive periods of rivalry and forbearance, possibly independently of time and institutional settings.

Suggested Citation

  • Michel Ghertman & Zied Guedri, 2012. "Rivalry and forbearance in the European airline industry : Evidence of an inverted U-shaped competitive pattern," Post-Print hal-02312833, HAL.
    • Handle: RePEc:hal:journl:hal-02312833
    DOI: 10.7202/1013147ar
    as

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