Integrating Industrial Organization and International Business to Explain the Cross-National Domestic Airline Merger Phenomenon

Lecture on the first SFB/TR 15 meeting, Gummersbach, July, 18 - 20, 2004The domestic airline merger phenomenon of the late 1980s and early 1990s sparked a great deal of Industrial Organization literature; yet, that literature neglected non-US merger activity and the potential for international competitive incentives. Using an International Business perspective to complement a primarily Industrial Organization analysis, I argue that factoring international competitive gains helps explain the domestic airline merger phenomenon. A Cournot model of airline competition illustrates the international incentives behind integrating domestic with international routes and behind acquiring domestic competitors. Further, comprehensive panel data tests also support large domestic networks and actual mergers improving the international competitiveness of airlines

Shifting Spatialities of Power: The Case of Australasian Aviation

This paper explores how different modalities, spatialities and scales of power operate in a geopolitical context. By tracing the dynamic and shifting economic geographies of state and firm power in the events leading up to the collapse of a major Australian firm, Ansett Airlines, it reveals the difference that place and position make to the creation and use of power. The paper stresses agents’ relational positioning, their ‘places’ in multiple networks of association and the ways in which their past actions and visions of the future condition their strategic options. The paper contextualises the workings of power and explores how power relationships are re-configured in specific contested events. It concludes that power cannot be separated from the spatial and temporal dimensions of actual contexts, from actor’s positions in contexts, or from their strategic objective

The political economy of Hong Kong's "open skies" legal regime: an empirical and theoretical exploration

Copyright 2009 San Diego International Law Journal. Reprinted with the permission of the San Diego International Law Journal.The article presents an empirical and theoretical research which describes the functions of the international legal regime through powerful economic forces in Hong Kong, China. The government applied aviation policies with respect to open skies platform to provide a basis for a thorough understanding of government's legitimacy based on neoclassical logic and analysis. Conceptual perspectives of realists, liberals and cognitivists were acknowledged by the economically-inspired nationalists

Anti-Competitive Marketing Practices in the Airline Industry

Consumers, airlines and the economy as a whole have benefited from airline deregulation. Government regulation was replaced by competition as the protector of the consumers. Airlines continue to pursue marketing strategies which reduce competition and as act as barriers to new entrants. This paper reviews some of those strategies and suggest actions by which policy makers might encourage competition

Integrating Industrial Organization and International Business to Explain the Cross-National Domestic Airline Merger Phenomenon

Lecture on the first SFB/TR 15 meeting, Gummersbach, July, 18 - 20, 2004The domestic airline merger phenomenon of the late 1980s and early 1990s sparked a great deal of Industrial Organization literature; yet, that literature neglected non-US merger activity and the potential for international competitive incentives. Using an International Business perspective to complement a primarily Industrial Organization analysis, I argue that factoring international competitive gains helps explain the domestic airline merger phenomenon. A Cournot model of airline competition illustrates the international incentives behind integrating domestic with international routes and behind acquiring domestic competitors. Further, comprehensive panel data tests also support large domestic networks and actual mergers improving the international competitiveness of airlines.airline-mergers; imperfect-competition; international-determinants

Strategic Alliances in the Global Airline Industry

Strategic alliances are common to any industry. Their presence is felt quite significantly in the airline industry. Starting in the US in 1978 deregulation of airline industry has since brought about sea changes in functioning of the industry. This paper attempts to understand the developments and strategic alliances that have occurred in the airline industry since deregulation. These strategic alliances exist in various forms and differ widely in scope and no consensus on classification was found. The advantages and disadvantages of strategic alliances with respect to the airline industry have been discussed. It is felt that the industry is getting increasingly concentrated. However, no conclusive remarks can be made about consumer welfare.

Airport Deregulation and Airline Competition

Liberalisation has affected all parts of the air travel industry, with airports as well as airlines increasingly run on commercial lines. This paper models interactions between airports and airlines to show that, for example, the potential benefits to passengers of increased competition between airlines may be (more than) absorbed by the unregulated airports through which they travel, and that effecting airport competition in one country may lead to the majority of the gains going abroad. The policy conclusion is that the (de)regulation of airlines and associated services should be fully co-ordinated and internationally coherent. Keywords: Airports, airlines, competition, deregulation