We examine airlines' pricing behavior with respect to fuel cost fluctuations. Managerial accounting “cost-plus” pricing models assume that a firm would adjust selling prices to “pass through” an increase or decrease in the costs of inputs. We find some evidence of airline pricing power...

This paper examines determinants of sticky cost behavior (asymmetric cost changes in response to revenue increases and decreases). Cost accounting researchers have examined sticky costs to gain insights about management capacity decisions as demand fluctuates. The majority of the extant...