Price Dispersion, Competition, and Efficiency: Evidence from Chicago Based Routes

44 Pages Posted: 31 May 2015 Last revised: 24 Sep 2017

See all articles by Levent Kutlu

Levent Kutlu

University of Texas Rio Grande Valley

Ran Wang

Georgia Institute of Technology

Date Written: January 25, 2017

Abstract

In this study we analyze the determinants of airline price dispersion. We particularly concentrate on the conduct and marginal cost efficiency. The effect of conduct on price dispersion seems to depend on the characteristics of the market. For the big city routes, we observe positive effect; and for the leisure routes we find negative effect. Also, we find that margial cost efficiency has a negative effect on price dispersion.

Keywords: Market power, Price Discrimination, Efficiency, Airlines

JEL Classification: D40, L10, L93

Suggested Citation

Kutlu, Levent and Wang, Ran, Price Dispersion, Competition, and Efficiency: Evidence from Chicago Based Routes (January 25, 2017). Available at SSRN: https://ssrn.com/abstract=2612265 or http://dx.doi.org/10.2139/ssrn.2612265

Levent Kutlu (Contact Author)

University of Texas Rio Grande Valley ( email )

1201 West University Dr
Edinburg, TX TX 78539
United States

HOME PAGE: http://https://faculty.utrgv.edu/levent.kutlu/

Ran Wang

Georgia Institute of Technology ( email )

Atlanta, GA 30332
United States

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