This paper analyzes the economic effects of the code-sharing alliances between an international and a domestic airline. If these two allied airlines and a separate unallied international airline endogenously choose the role of fare-leader or fare-follower, two types of Stackelberg equilibria...

This paper investigates the role of code-sharing alliances on entry deterrence. One major carrier operates a network with one hub that links n cities. It competes with another foreign carrier on one international spoke, while the other spokes are domestic and monopolized. There exists a...

A hub carrier operates one hub linking multiple non-hub cities. It merges with a low cost carrier whose nonstop service competes with its one-stop service. The merged airline's profit is maximized by withdrawing the competing one-stop (nonstop) service when the hub carrier's operating cost and...

We investigate a multi-market Cournot model with strategic process research and development (R&D) investments wherein a multi-market firm meets new competitors that enter one of the markets. We show that entry can enhance the total R&D expenditures of the multi-market firm. Moreover, the...

This paper investigates hub carriers’ airlines-within-airlines (AinA) strategies, intended to establish low-cost divisions offering nonstop flights on rim routes. An initial hub-spoke network is optimal if passenger differentiation between one-stop and nonstop services and via-hub time cost...

This paper constructs an entry and code-sharing alliances game to demonstrate that the alliance between the incumbent carriers may play a significant role of entry deterrence in a given airline network. We show that incumbents can use the alliances as a credible threat to deter the entry of the...

This paper investigates the airport privatization issue. One congested hub and two linked local airports serve symmetric hub carriers. Passengers valuate the congestion delay cost and benefit from greater frequencies. The government considers privatizing either the hub or local airports. We find...

This note studies the cost-reducing incentives in a mixed duopoly market. The result shows that while a profit-maximizing private firm carries out the cost-reducing investment, a social welfare-maximizing firm does not have an incentive to reduce its costs as long as the market share of the...