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Network Structure and Consolidation in the U.S. Airline Industry, 1990–2015

Authors
  • Ciliberto, Federico1, 2, 3
  • Cook, Emily E.1
  • Williams, Jonathan W.4
  • 1 University of Virginia, Department of Economics, Charlottesville, USA , Charlottesville (United States)
  • 2 The Center for Economic and Policy Research, London, United Kingdom , London (United Kingdom)
  • 3 DIW, Berlin, Germany , Berlin (Germany)
  • 4 University of North Carolina, Department of Economics, Chapel Hill, USA , Chapel Hill (United States)
Type
Published Article
Journal
Review of Industrial Organization
Publisher
Springer US
Publication Date
May 31, 2018
Volume
54
Issue
1
Pages
3–36
Identifiers
DOI: 10.1007/s11151-018-9635-y
Source
Springer Nature
Keywords
License
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Abstract

We study the effect of consolidation on airline network connectivity using three measures of centrality from graph theory: Degree; Closeness; and Betweenness. Changes in these measures from 1990 to 2015 imply: (i) the average airport services a greater proportion of possible routes; (ii) the average origin airport is fewer stops away from any given destination; and (iii) the average hub is less often along the shortest route between two other airports. Yet, we find the trend toward greater connectivity in the national network structure is largely unaffected by consolidation—in the form of mergers and codeshare agreements—during this period.

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