An Econometric Analysis of the Impact of Low-cost Carrier's entry on Regional and National Economy : The case of the US and Japan
| Project/Area Number |
15530284
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| Research Category |
Grant-in-Aid for Scientific Research (C)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
Commerce
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| Research Institution | Kobe University |
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Principal Investigator |
MURAKAMI Hideki Kobe University, Graduate School of Business Administration, Associate Professor, 経営学研究科, 助教授 (90243295)
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| Project Period (FY) |
2003 – 2004
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| Project Status |
Completed (Fiscal Year 2004)
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| Budget Amount *help |
¥3,200,000 (Direct Cost: ¥3,200,000)
Fiscal Year 2004: ¥700,000 (Direct Cost: ¥700,000)
Fiscal Year 2003: ¥2,500,000 (Direct Cost: ¥2,500,000)
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| Keywords | low-cost carrier / network carrier / oligopoly / collusion / quality competition / secondary airport / cross-subsidy / dynamic effect of entry / 経済的厚生 / ダイナミック・イフェクト / 外部性 / 輸送密度の経済 / サービス差別化 / クールノー競争 / 戦略効果 / 時間効果 / 経済厚生分析 / 複占・寡占 / 米国航空会社 / 日本の航空会社 / 第二空港 / スピルオーバー効果 |
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| Research Abstract |
(1)The cross-sectional analyses of US duopoly and 3-firm oligopoly air markets reveal that the entry of Southwest Airlines has significant impact on the market expansion. Due to its entry, the market demand curve shifts upward and the price and output increase in the short run, but in the long run the market price goes down. As for outputs, Southwest's rival faces significant decrease in its output in the long run, especially where Southwest and its rival base the same O/D airports.
(2)The panel analyses of the US duopoly and 3-firm oligopoly air market reveal that Southwest maintains its price after its entry and its rival(s) is(are) also permanently involved in the competition. Therefore, the prices will not restore to the pre-entry level. As for other entry case, price competitions start shortly after the new entry but the price war tends to end in a couple of years and prices will restore to the pre-entry level.
(3)There are few price competitions between Japanese major airlines but they compete with Shinkansen Express. Instead, Japanese major airlines are doing quality competition. Furthermore, Japanese major airlines earn their profit from long-haul jointly-monopolized markets such as Tokyo-Sapporo and Tokyo-Kyushu seem to cross-subsidy international markets and domestic markets where they compete with Shinkansen and domestic low-density markets.
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Report
(3 results)
Research Products
(11 results)
