Admission Price: Free to attend
This seminar is part of the Department of Economics Seminar Series 2018-19. The seminars are open to all - no registration necessary. If you would like to receive email notification of the Department’s seminars, please send your request to Kim.Edmunds.email@example.com.
Speaker: Prof Claudio Piga (Keele University)
It is standard practice for carriers to set fares by choosing, at each point in time, a distribution consisting of a possibly different fare for each seat on an aircraft. A model describes how fare distributions are shaped and evolve over time, thus unveiling some hidden dynamic pricing strategies. Empirical analysis supports two main theoretical predictions. First, fare distributions are increasing over the seats' order of sale. Second, fare distributions move downward over time to reflect the perishable nature of seats; such a shift is contrasted by the presence of high willingness-to-pay consumers in the late booking periods.
More generally, the article argues that any discussion on dynamic pricing in the airline market is at least misleading unless it is based on the premises of how fares are set in the industry.
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When and where
3.00pm - 4.30pmWednesday 14th February 2018