Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
1023794 | Transportation Research Part E: Logistics and Transportation Review | 2008 | 11 Pages |
Abstract
This paper analyses entry deterrence and accommodation by low cost carriers (LCCs) with two games. In the first game two LCCs compete in a horizontal differentiation setting. Results show that the entrant may drive away the incumbent from its original location under certain conditions. In the second game the incumbent is a LCC and the entrant a full service carrier, with vertical differentiation. The incumbent tries to deter or accommodate entry by product proliferation. We find out that the incumbent will only deter entry if it can surpass the entrant’s quality, and that product proliferation is not an accommodating strategy.
Keywords
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Business and International Management
Authors
Cristina Barbot,