EconPapers    
Economics at your fingertips  
 

Assessing firm behavior in carve-out markets: Evidence on the impact of carve-out policy

Philip Gayle () and Tyson Thomas

Journal of Economic Behavior & Organization, 2016, vol. 128, issue C, 178-194

Abstract: Airlines wanting to cooperatively set prices for their international air travel service must apply to the relevant authorities for antitrust immunity (ATI). While cooperation may yield benefits, it can also have anti-competitive effects in markets where partners competed prior to receiving ATI. A carve-out policy forbids ATI partners from cooperating in markets policymakers believe will be most harmed by anti-competitive effects. We examine carve-out policy applications to three ATI partner pairings, and find evidence more consistent with cooperative pricing in carve-out markets in spite of the policy, calling into question the effectiveness of the policy in achieving intended market outcomes.

Keywords: Airline competition; Antitrust immunity; Carve-out policy (search for similar items in EconPapers)
JEL-codes: L13 L40 L93 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167268116300865
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Assessing Firm Behavior in Carve-out Markets: Evidence on the Impact of Carve-out Policy (2016) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:128:y:2016:i:c:p:178-194

DOI: 10.1016/j.jebo.2016.05.007

Access Statistics for this article

Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

More articles in Journal of Economic Behavior & Organization from Elsevier
Bibliographic data for series maintained by Haili He ().

 
Page updated 2020-12-31
Handle: RePEc:eee:jeborg:v:128:y:2016:i:c:p:178-194