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Product Quality Effects of International Airline Alliances, Antitrust Immunity, and Domestic Mergers

Philip Gayle () and Tyson Thomas

MPRA Paper from University Library of Munich, Germany

Abstract: Much of the literature on airline cooperation focuses on the price effects of cooperation. A key contribution of our paper is to empirically examine the product quality effects of airline cooperation. Two common types of cooperation among airlines involve international alliances and antitrust immunity (ATI), where ATI allows for more extensive cooperation. Additionally, this paper examines the extent to which domestic mergers affect the quality of international air travel products. The results suggest that increases in the membership of a carrier’s alliance or ATI partners and domestic mergers are associated with the carrier’s own products having more travel-convenient routing quality. Therefore, a complete welfare evaluation of airline cooperation and mergers should not ignore product quality effects.

Keywords: Product quality; Airline competition; International alliance; Antitrust immunity; Mergers (search for similar items in EconPapers)
JEL-codes: L13 L40 L93 (search for similar items in EconPapers)
Date: 2015-09
New Economics Papers: this item is included in nep-com and nep-tre
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Journal Article: Product Quality Effects of International Airline Alliances, Antitrust Immunity, and Domestic Mergers (2015) Downloads
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