Empirical research on the relationship between market congestion and the market competitive level largely falsifies the positive relationship predicted by theoretical models. In this paper, I exploit the airline industry network structure and focus on the level of congestion during periods in...

We use unique data sets with round-the-clock posted fares and a regression discontinuity design to identify price discrimination in advance-purchase discounts. Price discrimination increases fares by 14% between two and one week before departure, and by 7.6% between three and two weeks to...

We propose a new approach to identify unobserved consumer types and assess whether firms price discriminate. We use a finite mixture structure to separate between consumer types under incomplete information. Unlike other screening schemes that rely on quantity discounts or product...

Frequent Flier Programs (FFPs) are said to impact airline consumer behaviour such that revenue of sponsoring airlines increases. Prior research relies on aggregate industry data to study FFPs. We examine the impact of FFPs on individual consumer behaviour in a quasi-natural experimental set-up...

This paper uses an original panel dataset with posted prices and sales to estimate a dynamic demand. We find that consumers become more price sensitive as time to departure nears which is consistent with having lower valuations. This result provides empirical support to a key theoretical...

Conventional economic wisdom suggests that congestion pricing would be an appropriate response to cope with the growing congestion levels currently experienced at many airports. Several characteristics of aviation markets, however, may make naive congestion prices equal to the value of marginal...

This paper offers a simple approach for identifying propagated departure delays and measuring their contribution to arrival delays. Under our approach, a propagated departure delay occurs when the arrival delay of the inbound flight exceeds the subsequent flight’s ground buffer. The size (or...

This paper uses an original panel dataset with posted prices and sales to estimate a dynamic demand. We find that consumers become more price sensitive as time to departure nears which is consistent with having lower valuations. This result provides empirical support to a key theoretical...

This paper assesses the impact of the September 11th terrorist attacks and its after-effects on U.S. airline demand. Using monthly time-series data from 1986-2003, we find that September 11th resulted in both a negative transitory shock of over 30% and an ongoing negative demand shock amounting...