Are Airlines' Price Setting Strategies Different?

Bilotkach, Volodymyr; Talavera, Oleksandr; Gorodnichenko, Yuriy; Zubenko, Igor

doi:10.2139/ssrn.953507

Download This Paper

Open PDF in Browser

Add Paper to My Library

Are Airlines' Price Setting Strategies Different?

12 Pages Posted: 26 Dec 2006

See all articles by Volodymyr Bilotkach

Yuriy Gorodnichenko

University of California, Berkeley - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Igor Zubenko

Ostroh Academy National University

Date Written: October 2006

Abstract

Using a sample of fare quotes for non-stop travel from New York to London, this paper investigates the dynamics of offered fares as the departure date nears. We find that the general trend is toward fare increase at an accelerated rate as the departure date approaches. Clear differences in price-setting strategies among the carriers competing on a particular route are documented.

Keywords: airline industry, price dynamics

JEL Classification: L93, D21

Suggested Citation: Suggested Citation

Bilotkach, Volodymyr and Talavera, Oleksandr and Gorodnichenko, Yuriy and Zubenko, Igor, Are Airlines' Price Setting Strategies Different? (October 2006). Available at SSRN: https://ssrn.com/abstract=953507 or http://dx.doi.org/10.2139/ssrn.953507