When Do Firms Offer Higher Product Quality? Evidence from the Allocation of Inflight Amenities

B-Tier
Journal: Review of Industrial Organization
Year: 2023
Volume: 62
Issue: 2
Pages: 149-177

Score contribution per author:

0.670 = (α=2.01 / 3 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Abstract We examine how competition impacts the provision of product quality. Using a unique data set of inflight amenities provided by U.S. airlines, we find that the composition of competition matters. There is significantly higher product quality - Wi-Fi, entertainment, and at-the-seat electrical power outlets - on on more competitive routes (with lower HHI). The presence of Southwest Airlines on the route, however, is shown to reduce product quality offerings. We also find significantly higher product quality on routes with more passengers, tourist destinations, and red-eye flights. We find lower posted base ticket prices on routes with Wi-Fi and entertainment amenities.

Technical Details

RePEc Handle
repec:kap:revind:v:62:y:2023:i:2:d:10.1007_s11151-022-09892-9
Journal Field
Industrial Organization
Author Count
3
Added to Database
2026-01-25