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Lookup NU author(s): Dr Volodymyr Bilotkach
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As low-cost airlines or carriers excluded from international markets by regulation may seek to expand internationally in an indirect way through code-sharing agreements, they can choose partner airlines from among domestic or international carriers. The former case results in a semi-complementary partnership, while in the latter a classic complementary alliance is formed. This paper compares welfare properties of the two types of partnerships under economies of traffic density. Semi-complementary partnerships yield higher total welfare (but not necessarily lower prices) when economies of traffic density are strong, demand is more price-sensitive, or where a carrier feeding domestic traffic to international routes is a lower cost one.
Author(s): Bilotkach V
Publication type: Article
Publication status: Published
Journal: Transportation Research Part B: Methodological
Year: 2007
Volume: 41
Issue: 4
Pages: 381-393
ISSN (print): 0191-2615
ISSN (electronic): 1879-2367
Publisher: Pergamon
URL: http://dx.doi.org/10.1016/j.trb.2006.06.002
DOI: 10.1016/j.trb.2006.06.002
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