Price Discrimination in International Airline Markets

• 成果类型: Article
• 署名作者: Aryal, Gaurab; Murry, Charles; Williams, Jonathan W.
• 署名单位: Washington University (WUSTL); Boston College; University of North Carolina; University of North Carolina Chapel Hill; University of North Carolina School of Medicine
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdad037
• 发表日期: 2024
• 页码: 641-689
• 关键词: EMPIRICAL-ANALYSIS; revenue management; demand; monopoly; COMPETITION; parameters; consumers; privacy; sales

摘要

We develop a model of inter-temporal and intra-temporal price discrimination by monopoly airlines to study the ability of different discriminatory pricing mechanisms to increase efficiency and the associated distributional implications. To estimate the model, we use unique data from international airline markets with flight-level variation in prices across time, cabins, and markets and information on passengers' reasons for travel and time of purchase. The current pricing practice yields approximately 77% of the first-best welfare. The source of this inefficiency arises primarily from private information about passenger valuations, not dynamic uncertainty about demand. We also find that if airlines could discriminate between business and leisure passengers, total welfare would improve at the expense of business passenger surplus. Also, replacing the current pricing that involves screening passengers across cabin classes with offering a single cabin class has minimal effect on total welfare.