DETERMINANTS OF PRICE DISPERSION IN U.S. AIRLINE MARKETS

Although a well recognized and unpredicted post deregulation development, the complex airline fare structure has received relatively little research attention. This paper develops a multiple regression model measuring the relationship of several market variables to the degree of ticket price dispersion observed in the 200 largest U.S. airline markets during the 3rd quarter of 1995. A wide range of ticket prices is evident on most routes. Results show that ticket price dispersion on some given routes increase with the number of competitors, with service by a combination of non-stop and connecting flights, when a low-cost airline competes with other major carriers, and when the capacity of one of the airports is limited by regulation. The model explains 41% of observed ticket price dispersion.

• Corporate Authors:

  Aviation Institute

  University of Nebraska, 60th and Dodge Streets
  Omaha, NE  United States  68182-0508
• Authors:
  • Cook, G N
• Publication Date: 2000

Language

• English

Media Info

• Features: Appendices; References; Tables;
• Pagination: p. 39-54
• Serial:
  • Journal of Air Transportation World Wide
  • Volume: 5
  • Issue Number: 2
  • Publisher: Aviation Institute

Subject/Index Terms

• TRT Terms: Air transportation; Air travel; Airlines; Deregulation; Fares; Multiple regression analysis; Pricing; Regulation
• Uncontrolled Terms: Airline flights
• Geographic Terms: United States
• Subject Areas: Aviation; Economics;

Filing Info

• Accession Number: 00800310
• Record Type: Publication
• Files: TRIS
• Created Date: Oct 2 2000 12:00AM