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Marco Alderighi
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Journal Articles
Publisher: Journals Gateway
The Review of Economics and Statistics (2015) 97 (4): 900–915.
Published: 01 October 2015
Abstract
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Based on two strands of theoretical research, this paper provides new evidence on how fares are jointly affected by in-flight seat availability and purchasing date. As capacity-based theories predict, it emerges that fares monotonically and substantially increase with flight occupancy. After controlling for capacity utilization, our analysis also supports time-based theories, indicating a U-shaped temporal profile over a two-month booking period, as well as a sharp increase in fares in the two weeks prior to departure.