Airport Concentration and Market Power: An Events Study Approach

Airport Concentration and Market Power: An Events Study Approach This paper presents independent confirmation of the results obtained in recent studies that suggest mergers and acquisitions creating airline dominance at the airport level lead to market power. Using a different methodology – an events study for the 1986 merger of Northwest Orient Airlines and Republic Airlines – this paper confirms those results, indicating that concentration in the context of the sunk costs associated with the operation at a particular airport facility allows market power in the airline industry. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Industrial Organization Springer Journals

Airport Concentration and Market Power: An Events Study Approach

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Publisher
Springer Journals
Copyright
Copyright © 1997 by Kluwer Academic Publishers
Subject
Economics; Industrial Organization; Microeconomics
ISSN
0889-938X
eISSN
1573-7160
D.O.I.
10.1023/A:1007700827041
Publisher site
See Article on Publisher Site

Abstract

This paper presents independent confirmation of the results obtained in recent studies that suggest mergers and acquisitions creating airline dominance at the airport level lead to market power. Using a different methodology – an events study for the 1986 merger of Northwest Orient Airlines and Republic Airlines – this paper confirms those results, indicating that concentration in the context of the sunk costs associated with the operation at a particular airport facility allows market power in the airline industry.

Journal

Review of Industrial OrganizationSpringer Journals

Published: Sep 29, 2004

References

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