Investigating the Pricing Impact of the American Airlines and US Airways Merger
In 2013, American Airlines merged with US Airways creating the largest airline in the world. This paper analyzes this merger’s effect on domestic airline ticket pricing using the Department of Transportation’s 10% ticket sample. In particular, and of particular importance in mergers, this analysis focuses on the role of competition pre and post-merger on these impacts. This analysis shows that the merged airline was able raise their fares. In addition, where a legacy carrier was in the market and US Airways and/or American Airlines did not play a role (as either an incumbent or a potential entrant) prices also rose. In markets where US Airways and/or American did play a role, fares for these legacy carriers still rose but by less than when these carriers were present. For low cost carriers in the equivalent situations, prices declined. In markets where American and/or US Airways did play a role, for low cost carriers, prices declined and those declines were larger in markets where American and/or US Airways was an actual incumbent instead of a potential competitor.
Nozick, Linda K.
Alvarez Daziano, Ricardo
Civil and Environmental Engineering
M.S., Civil and Environmental Engineering
Master of Science
dissertation or thesis