Non-stop Love: A Study of Entry Barriers in the Airline Industry Using Policy Changes at Dallas Love Field

Pukar Kc ()
Additional contact information
Pukar Kc: Northeastern University

Eastern Economic Journal, 2020, vol. 46, issue 3, No 1, 379-413

Abstract: Abstract Exogenous changes in entry barrier conditions faced by firms allow for an analysis of their impact on competition and market structure. This empirical study finds that the policy changes at Love Field airport arising from the repeal of the Wright Amendment in October 2014 led to reduction in airfares on routes between Dallas and cities beyond the neighboring states of Texas, but increase in airfares on routes between Dallas and destinations in Texas and its surrounding states (collectively called the Wright Perimeter). The fare decrease can be attributed to airlines (primarily Southwest) entering non-stop markets from Love Field, whereas the fare increases in the short-haul within Wright Perimeter markets indicates the impact of binding gate constraints. A capacity-constrained entry model is used to explain the opposite effects in different markets.

Keywords: Competition; Regulation; Industrial organization (search for similar items in EconPapers)
JEL-codes: D04 K21 L9 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1057/s41302-019-00165-0 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
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:pal:easeco:v:46:y:2020:i:3:d:10.1057_s41302-019-00165-0

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/41302

DOI: 10.1057/s41302-019-00165-0

Access Statistics for this article

Eastern Economic Journal is currently edited by Allan Zebedee and Cynthia Bansak

More articles in Eastern Economic Journal from Palgrave Macmillan, Eastern Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().