Arbeitspapier

European Airline Mergers, Alliance Consolidation, and Consumer Welfare

This paper explores the effects of a European airline merger followed by a consolidation of two competing international alliances. The exercise has been inspired by the Air France-KLM merger, which is expected to spur consolidation of the Northwest-KLM and SkyTeam alliances into a single mega-alliance. The results of the analysis show that, although the airlines benefit through higher profits, the merger and alliance consolidation harm consumers while reducing overall social surplus. The reason for this negative outcome is that, as modeled, all the effects of the merger and alliance consolidation are anticompetitive.

Language
Englisch

Bibliographic citation
Series: CESifo Working Paper ; No. 1154

Classification
Wirtschaft
Subject
european airline merger
airlines
airline alliance
transportation

Event
Geistige Schöpfung
(who)
Brueckner, Jan K.
Pels, Eric
Event
Veröffentlichung
(who)
Center for Economic Studies and ifo Institute (CESifo)
(where)
Munich
(when)
2004

Handle
Last update
10.03.2025, 11:42 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Brueckner, Jan K.
  • Pels, Eric
  • Center for Economic Studies and ifo Institute (CESifo)

Time of origin

  • 2004

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