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| Author: | Barla, P. Constantatos, C. |
| Title: | On the choice between strategic alliance and merger in the airline sector: the role of strategic effects |
| Journal: | Journal of Transport Economics and Policy
2006 : SEP, VOL. 40:3, p. 409-424 |
| Index terms: | airlines alliances mergers strategy |
| Language: | eng |
| Abstract: | This paper considers a market with three competitors, two of which decide to co-operate. Companies first choose capacity under demand uncertainty, then compete in quantities after the uncertainty has been resolved. Strategic alliance (SA) is specified as an agreement where two airlines jointly choose capacity and divide it among themselves. Contrary to the full merger case, after demand is revealed the alliance members market their capacity shares independently. |
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