scholarly journals Price Discrimination and Focal Points for Tacit Collusion: Evidence from the Airline Industry

2016 ◽  
Author(s):  
Diego Escobari ◽  
Nicholas G. Rupp ◽  
Joseph Meskey
Keyword(s):  
Price Discrimination ◽  
Airline Industry ◽  
Tacit Collusion ◽  
Focal Points

Price Ceilings as Focal Points for Tacit Collusion: Evidence from Credit Cards

2003 ◽  
Vol 93 (5) ◽  
pp. 1703-1729 ◽  
Author(s):  
Christopher R Knittel ◽  
Victor Stango
Keyword(s):  
Credit Card ◽  
Focal Point ◽  
Credit Cards ◽  
State Level ◽  
Tacit Collusion ◽  
Focal Points ◽  
National Integration ◽  
Credit Card Market ◽  
Using Data ◽  
Perverse Effect

We test whether a nonbinding price ceiling may serve as a focal point for tacit collusion, using data from the credit card market during the 1980’s. Our empirical model can distinguish instances when firms match a binding ceiling from instances when firms tacitly collude at a nonbinding ceiling. The results suggest that tacit collusion at nonbinding state-level ceilings was prevalent during the early 1980’s, but that national integration of the market reduced the sustainability of tacit collusion by the end of the decade. The results highlight a perverse effect of price regulation.

scholarly journals Price Discrimination and Yield Management in the Airline Industry

2021 ◽  
pp. 404-408
Author(s):  
Guoquan Zhang ◽  
Colin C.H. Law ◽  
Yahua Zhang ◽  
Hangjun Yang
Keyword(s):  
Price Discrimination ◽  
Airline Industry ◽  
Yield Management

scholarly journals Theory of product policy and practices in airlines

2019 ◽  
Vol 24 (6) ◽  
pp. 425-427
Author(s):  
Ronald Wilczek
Keyword(s):  
Price Discrimination ◽  
Airline Industry ◽  
New Technology ◽  
Product Policy ◽  
Competitive Industry ◽  
New Distribution

Pricing and product policy in the airline industry is very complex and different from other industries, thus a successful airline has to manage its products and pricing perfectly, otherwise it will not succeed on the extremely competitive airlines market. This paper has two main goals, firstly to generally define product policy and secondly to show the product policy of airlines. Currently, airlines operate in a very competitive industry with little to no option to differentiate their product which leads to low profitability. New Distribution Capability and another new technology have the potential to increase airlines’ revenue by better price discrimination and more personalization.

scholarly journals Price Dispersion in the U.S. Airline Industry

2012 ◽  
Vol 48 (3) ◽  
Author(s):  
Junwook Chi ◽  
Won. W. Koo ◽  
Siew H. Lim
Keyword(s):  
Instrumental Variables ◽  
Price Discrimination ◽  
Airline Industry ◽  
Price Dispersion ◽  
Pricing Strategies ◽  
Average Price ◽  
Iv Estimation ◽  
Air Carriers ◽  
The U.S

This paper explores price dispersion in the U.S. airline industry by highlighting differential individual carriers' pricing strategies. Using instrumental variables (IV) estimation, the results show that individual carriers play crucial roles in determining price dispersion, implying that their price discrimination strategies may influence variation in airfares. Based on observed price dispersion and average price, we distinguished sources of price dispersion and found that the pricing strategies varied across U.S. air carriers. In 2005, for example, monopoly-type price discrimination was likely to result in price dispersion for Northwest, whereas competitive-type price discrimination was likely to lead to price dispersion for Delta.

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