Footnote:
In: International Journal of Industrial Organization, Vol. 28, No. 4, 2010
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments Juny 1, 2010 erstellt
Description:
In a hub-and-spoke network, the profit function of an airline is supermodular with respect to the airline's own entry decisions for different city-pairs. This source of complementarity implies that a hub-and-spoke network can be an effective strategy for deterring the entry of competitors. This paper presents an empirical dynamic game of airline network competition that incorporates this entry deterrence motive for using hub-and-spoke networks. We summarize the results of the estimation of the model, with special attention to empirical evidence regarding the entry deterrence motive