Title: Incumbent Response to Entry by Low-Cost Carriers in the U.S. Airline Industry
Abstract: This article studies incumbent price response to entry by low-cost carriers in the U.S. airline industry. I find that legacy carrier incumbents decrease their mean airfare, 10th percentile airfare, and 90th percentile airfare following entry by a low-cost carrier. Airfares decrease by a larger percentage at the right tail of the incumbents’ price distribution than at the left tail, suggesting that increased competition from low-cost carrier entrants leads to lower price dispersion.
Publication Year: 2015
Publication Date: 2015-11-26
Language: en
Type: article
Indexed In: ['crossref']
Access and Citation
Cited By Count: 30
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