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Lookup NU author(s): Dr Volodymyr Bilotkach
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© 2014 by Emerald Group Publishing Limited. Platforms in two-sided markets are known to provide subsidies to either buyers or sellers, in order to take advantage of cross-group externalities inherent in such industries. Online travel agents can be thought of as platforms facilitating trade between passengers and travel service providers (airlines). This chapter evaluates the effects of a buyer subsidy provided by one major US online travel agent a low-price guarantee offered by Orbitz. We find evidence consistent with increased airline participation with this travel agent upon implementation of the low-price guarantee policy. Our results also confirm the theoretical claims that most-favored customer low-price guarantee policies are procompetitive.
Author(s): Bilotkach V, Rupp NG
Publication type: Book Chapter
Publication status: Published
Book Title: The Economics of International Airline Travel
Year: 2014
Volume: 4
Pages: 339-374
Online publication date: 06/08/2014
Acceptance date: 01/01/1900
Series Title: Advances in Airline Economics
Publisher: Emerald Group Publishing Ltd
URL: https://doi.org/10.1108/S2212-160920140000004012
DOI: 10.1108/S2212-160920140000004012
Library holdings: Search Newcastle University Library for this item
ISBN: 9781783506392