In this paper we study the impact of competition on the provision of quality in the US airline industry. Using changes in competition triggered by LCC entry and airline mergers, we find that an increase in competition increases the provision of quality of major incumbent and non-merging airlines...

We analyze the effect of competition on price dispersion in the airline industry and show that the outcome hinges on redefining the extent of a market. Using panel data from 1993 to 2013, an increase in competition has a positive effect on price dispersion in one-way markets but a negative...

We study relational contracts as a means to govern transactions across firm boundaries. We focus on the airline industry, where real-time adaptation of flight schedules under bad weather is not formally contractible, and yet is essential for performance and long-term profitability. While...

Using data on four large mergers in the U.S. airline industry, we find consistent and significant effects of mergers on peripheral markets (i.e. those in which neither of the merging firms currently competes). Although such markets are rarely the focus of antitrust analysis, we demonstrate that...

Major airlines rely on fuel hedging to manage risk of volatile fuel prices. We show that fuel hedging leads to lump sum gain or loss, which does not affect airlines' purchase cost of fuel (variable cost), but is incorporated into the reported airline fuel costs. Our estimation results suggest...

In 2010, Spirit airlines announced that it would start charging passengers for carry-on baggage. Using a vector of route level characteristics, we construct a matched group consisting of routes which best match those served by Spirit (treated group). We then run a diff-in-diff estimation using...

This paper examines US airline mergers between 1993 and 2018 and studies their impact on the labor market. Our difference-in-differences estimates indicate a significant reduction in the merging airlines' long-term wage and fringe benefits following the mergers. The effect is particularly...

This paper examines the impact of labor unions on firms' quality provisions through the lens of the U.S. airline industry. Leveraging quarterly carrier-route level data on flight frequencies and on-time performance from the Bureau of Transportation Statistics from 1993 to 2019, our...