Impact of aircraft size and seat availability on airlines' demand and market share in duopoly markets

Wenbin Wei and Mark Hansen

Transportation Research Part E: Logistics and Transportation Review, 2005, vol. 41, issue 4, 315-327

Abstract: We build a nested logit model to study the roles of aircraft size, together with service frequency, seat availability and fare, in airlines' market share and total demand in non-stop duopoly markets. We find that airlines can obtain higher returns in market share from increasing service frequency than from increasing aircraft size, and our study confirms an S-curve effect of service frequency on airlines' market share. We find that the available capacity per flight--net of capacity absorbed by connecting passengers--affects market share in the same manner whether it is derived from a larger proportion of a smaller aircraft or smaller proportion of a larger one.

Keywords: Aircraft; size; Seat; availability; Airline; demand; Market; share; Duopoly; market (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (58)

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