Related papers: Common Subcontracting and Airline Prices
The COVID-19 pandemic has had serious impacts on the airline industry. Ensuring that aviation policies in emergent situations both guarantee network connectivity and maintain competition among airlines is crucial in these circumstances. To…
In many markets, like electricity or cloud computing markets, providers incur large costs for keeping sufficient capacity in reserve to accommodate demand fluctuations of a mostly fixed user base. These costs are significantly affected by…
This paper studies multilateral matching in which agents may negotiate contracts within any coalition. We assume scale economies such that an agent substitutes some existing contracts with new ones only if the latter involve a set of…
On-demand transport services in the form of dial-a-ride and taxis are crucial parts of the transport infrastructure in all major cities. However, not all on-demand transport services are equal. In particular, not-for-profit dial-a-ride…
Flight delays are a reality in the modern air industry worldwide. However, studies in the literature have investigated the competitive determinants of delays arising from factors originating at the airport and along the route separately.…
Internet users have suffered collateral damage in tussles over paid peering between large ISPs and large content providers. In order to qualify for settlement-free peering, large Internet Service Providers (ISPs) require that peers meet…
This paper analyzes optimal insurance design when the insurer internalizes the effect of coverage on third-party service prices. A monopolistic insurer contracts with risk-averse agents who have sequential two-dimensional private…
Firms' algorithm development practices are often homogeneous. Whether firms train algorithms on similar data, aim at similar benchmarks, or rely on similar pre-trained models, the result is correlated predictions. We model the impact of…
This article provides a simple explanation of the asymptotic concavity of the price impact of a meta-order via the microstructural properties of the market. This explanation is made more precise by a model in which the local relationship…
Consumers can acquire information through their own search efforts or through their social network. Information diffusion via word-of-mouth communication leads to some consumers free-riding on their "friends" and less information…
A statistical generalization is made of microeconomics in the spirit of going from classical to statistical mechanics. The price and quantity of every commodity1 traded in the market, at each instant of time, is considered to be an…
Transit fare arbitrage is the scenario when two or more commuters agree to swap tickets during travel in such a way that total cost is lower than otherwise. Such arbitrage allows pricing inefficiencies to be explored and exploited, leading…
We study competition between firms that contract with consumers before the consumers fully learn their product preferences. In a Hotelling duopoly, firms screen consumers by offering menus of option contracts. We characterize the unique…
A distributed, hierarchical, market based approach is introduced to solve the economic dispatch problem. The approach requires only a minimal amount of information to be shared between a central market operator and the end-users. Price…
This paper investigates the benefits of incorporating diversification effects into the pricing process of insurance policies from two different business lines. The paper shows that, for the same risk reduction, insurers pricing policies…
Commercial aviation is one of the biggest contributors towards climate change. We propose to reduce environmental impact of aviation by considering solutions that would reduce the flight time. Specifically, we first consider improving winds…
Firms in the U.S. spend over 200 billion dollars each year advertising their products to consumers, around one percent of the country's gross domestic product. It is of great interest to understand how that aggregate expenditure affects…
Berkson errors are commonplace in empirical microeconomics. In consumer demand this form of measurement error occurs when the price an individual pays is measured by the (weighted) average price paid by individuals in a specified group…
Global supply networks in agriculture, manufacturing, and services are a defining feature of the modern world. The efficiency and the distribution of surpluses across different parts of these networks depend on choices of intermediaries.…
Restructuring route networks (i.e., modifying the graph of origin-destination pairs) remains a promising alternative for reducing the airline industry's environmental impact. However, there exists a fundamental trade-off between emissions…