They must look at smaller airports that may not be as popular. Price rigidity and nonprice competition have occurred through these airlines as well. Prices have dropped to the point that the airlines must compete through other means such as advertising and customer service. Airlines now offer more perks for traveling with them. They may offer rewards for frequent flyers. Advertising becomes more strategic as well. Conclusion. In conclusion, many airlines have basically become an oligopoly. The key characteristics apply perfectly to major airlines. Economics of scale, growth through merger, mutual dependence, and price rigidity and nonprice competition all play key roles in the major airlines today.
AIRLINE ECONOMICS 4 References Economics Online. (n.d.). Economics Online. Retrieved January 29, 2017, from Fossum, J. A. (2015). Labor relations: Development, structure, process (Twelfth ed.). New York, NY: McGraw-Hill Education. Kumar, M. (2016, August 28). Top 9 Characteristics of Oligopoly Market. Retrieved January 29, 2017, from - of -oligopoly-market/7342 Wensveen, J. G. (2011). Air transportation: A management perspective. (7th ed.). Burlington, VT: Ashgate.
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