Data-driven airline passenger flight supply comparison with optimal transport theory

Qian Liu (), Paul Rochet () and Chantal Roucolle ()
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Qian Liu: ENAC - Ecole Nationale de l'Aviation Civile, Fédération ENAC ISAE-SUPAERO ONERA - ISAE-SUPAERO - Institut Supérieur de l'Aéronautique et de l'Espace - ONERA - ENAC - Ecole Nationale de l'Aviation Civile
Paul Rochet: ENAC - Ecole Nationale de l'Aviation Civile, Fédération ENAC ISAE-SUPAERO ONERA - ISAE-SUPAERO - Institut Supérieur de l'Aéronautique et de l'Espace - ONERA - ENAC - Ecole Nationale de l'Aviation Civile
Chantal Roucolle: ENAC - Ecole Nationale de l'Aviation Civile, Fédération ENAC ISAE-SUPAERO ONERA - ISAE-SUPAERO - Institut Supérieur de l'Aéronautique et de l'Espace - ONERA - ENAC - Ecole Nationale de l'Aviation Civile

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Abstract: This study presents an optimal transport (OT) framework to analyze airline supply in a pairwise manner, with an emphasis on strategic similarity and competitive intensity. By representing route-level supply as probability distributions and defining adapted cost structures, we develop a flexible approach to build comparative indices between airlines. We discuss three applications: route strategic positioning, competitive intensity, and operational cost. Applied to European domestic airlines, these indices reveal that mainline carriers exhibit greater strategic similarity due to their extensive networks, and low-cost carriers experience higher competitive intensity because of the geographic proximity of their routes. Full-service and low-cost carriers differ notably in operational strategies regarding frequency allocation and flight length choices. Compared with traditional multimarket contact (MMC) measures, the OT-based approach provides an interpretable, continuous metric that incorporates partial market substitutability through airport catchment areas. The framework can potentially be generalized to other transport systems, providing a robust methodological tool for measuring transporter competition, network structural changes, and strategic similarity across spatially distributed supply networks.

Keywords: Market competition measurement; Business model convergence; Multimarket contact; Strategic similarity; Competitive intensity; Pairwise analysis (search for similar items in EconPapers)
Date: 2026-02-11
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