Market Structure and Competition in Airline Markets

• 成果类型: Article
• 署名作者: Ciliberto, Federico; Murry, Charles; Tamer, Elie
• 署名单位: University of Virginia; Boston College; Harvard University
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/715848
• 发表日期: 2021
• 页码: 2995-3038
• 关键词: 1st-price auctions; sample selection; entry; MODEL; equilibrium; mergers; parameters; collusion; oligopoly; welfare

摘要

We provide an econometric framework for estimating a game of simultaneous entry and pricing decisions while allowing for correlations between unobserved cost and demand shocks. We use our framework to account for selection in the pricing stage. We estimate the model using data from the US airline industry and find that not accounting for endogenous entry leads to biased estimation of demand elasticities. We simulate a merger between American and US Airways and find that product repositioning and postmerger outcomes depend on how we model the characteristics of the merged firm as a function of the premerger firms' characteristics.