Network Structure and Consolidation in the US Airline Industry, 1990-2015
45 Pages Posted: 20 Jul 2017
Date Written: July 12, 2017
We study the effect of consolidation on airline network connectivity using three measures of centrality from graph theory: Degree, Closeness, and Betweenness. Changes in these measures from 1990 to 2015 imply: i) the average airport services a greater proportion of possible routes, ii) the average origin airport is fewer stops away from any given destination, and iii) the average hub is less often along the shortest route between two other airports. Yet, we find the trend toward greater connectivity in the national network structure is largely unaffected by consolidation, in the form of mergers and codeshare agreements, during this period.
Keywords: Network, Airlines, Consolidation, Mergers, Codeshare Agreements, Airports
JEL Classification: L13, L93
Suggested Citation: Suggested Citation