A Cournot model for analysing the effects of an open skies agreement

• Type: Article in International Scientific Journal
• Date: 2015

Authors

Vera Martins (Author) FEP; Rosa Maria Forte (Author) FEP

Journal

Title: Journal of Air Transport Management

Vol. 42

Pages: 125-134

ISSN: 0969-6997

Publisher: Elsevier

Indexing

ISI Web of Knowledge - 6 Citations

ISI Web of Science

Scopus - 9 Citations

Scientific classification

FOS: Social sciences > Economics and Business

CORDIS: Social sciences > Economics > International economics

Other information

Authenticus ID: P-00A-2KX

DOI: 10.1016/j.jairtraman.2014.09.007

Abstract (EN): In the last decades there has been a gradual liberalisation of international air transport markets through the implementation of open skies agreements which seek the deregulation of the air transport industry and consequently the functioning of the market in a freer way. The objective of this work is to study the effects of an open skies agreement in order to understand if the airlines and the consumers will benefit after the market deregulation. With this purpose, we develop a Coumot model to compare the initial situation (without agreement) and the situation after the implementation of the open skies agreement. Based on the model developed we conclude that after market liberalisation the prices on international market segments where competition increases should decline, thus benefiting consumers. Regarding the incumbent airlines in the market, an open skies agreement should jeopardize the airlines that fail to operate new routes, leading to decreased profits.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 10