 Global airline alliances and profitability: A difference-in-difference analysisIan Douglas and David Tan Transportation Research Part A: Policy and Practice, 2017, vol. 103, issue C, 432-443 Abstract: Alliances and partnerships between airlines are entered into to create competitive advantage, reduce costs, and expand network reach. Three global alliance clusters emerged, with founding partners located in the major geographic regions, and often already involved in bilateral partnerships with other founders. This study examines whether the formation of global airline alliances, with its related expansion of network reach, resulted in an increase in profitability for the founding members. Employing difference-in-difference regressions, this study has found no evidence that the formation of global alliances improved the profitability of founding member airlines, or conferred an economic advantage over airlines that were not founding members. This result is robust across geographic regions, individual global alliances, and alternative event dates. The results of this research suggest that regulators should be less anxious that by sanctioning these closer relationships they are providing major carriers with opportunities for excessive profits. Date: 2017 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:transa:v:103:y:2017:i:c:p:432-443 Ordering information: This journal article can be ordered from DOI: 10.1016/j.tra.2017.05.024 Access Statistics for this article Transportation Research Part A: Policy and Practice is currently edited by John (J.M.) Rose More articles in Transportation Research Part A: Policy and Practice from Elsevier |
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