Using a theoretical model, we examine both the relationship between a downstream dominant firm’s market share and an upstream monopoly’s Lerner index and the relationship between upstream and downstream price elasticities of demand, in a regulated industry context. We undertake an empirical...

According to theoretical predictions, the application of peak-load pricing to utilities is expected to result in higher levels of welfare and is recommended on that basis. This price system is adopted by some airports in the EU, in order to alleviate congestion by means of shifting demand, while...

With the recent wave of privatisation and liberalisation the number of state owned firms has remarkably decreased. In some industries, namely in healthcare and education, and in many countries, they go on playing an important role, alone or competing with private ones. In this paper we use a...

The promotion of a competition policy in air transport faces several obstacles. One of them is the absence of mobility airports’ slots. The European Commission has been preparing legislation on this matter, with the prime objective of encouraging an effective mobility that leads to a more...

The Portuguese region of Ave experienced, in the eighties, a process of crisis, followed by a noticeable recovery. The aim of this paper is to find industry specific determinants of firms’ entry and survival for Ave during that period. Results appear to be different from those of other...

In this paper a vertical differentiation model is built in order to analyse the effects of subsidies to secondary airports, or of lower prices set by them, on the competition between LCC’s and FSC’s. The Ryanair/ Charleroi agreement is used as an example and as a basis for the model. The...

Airports and airlines have been increasingly establishing vertical contracts, which have a wide variety of forms. These contracts have important implications for policy issues, namely for regulation and price discrimination legislation. In this paper we develop a model to analyse the effects of...

Low cost carriers (LCCs) have recently proved that they can develop aggressive behaviour towards the threat of new entrants. This paper analyses the theoretical conditions under which a low cost carrier can deter or accommodate entry by means of product proliferation, using the example of...

The effects of merger have usually been examined in the context of homogeneous goods, and are unambiguously established. This paper deals with merger in vertically differentiated industries, presenting two models, one with two firms, and one with three firms. Results depend on the number of...

In this paper, we investigate whether different business models in the same industry (passenger air transportation) lead to different corporate governance models. We found that low cost carriers (LCCs) organise their boards differently from full service carriers (FSCs), in order to achieve lower...