Assessing the Impacts of Northeast Alliance between American Airlines and JetBlue Airways

Authors

Li Zhou, Embry-Riddle Aeronautical UniversityFollow
Chunyan Yu, Embry-Riddle Aeronautical UniversityFollow
Daniel Friedenzohn, Embry-Riddle Aeronautical UniversityFollow

Submitting Campus

Daytona Beach

Department

College of Aviation

Document Type

Article

Publication/Presentation Date

1-11-2023

Abstract/Description

This paper investigates the impacts of Northeast Alliance (NEA) between American Airlines and JetBlue Airways on market concentration and airfares on routes to and from the four pertinent airports in Boston and New York regions. Using panel data covering quarterly domestic flight schedules and airfares for 11 U.S. airlines during the 2019-2021 period, we apply difference-in-difference method and find evidence for positive and significant NEA effect on market concentration on routes out of BOS, and negative and significant effect on routes out of EWR, but no significant effect for routes out of JFK and LGA. The overall NEA effects, including all four airports, are not significant. Furthermore, our airfare estimation results indicate that NEA has led to higher airfares on routes out of BOS, JFK and LGA, but not on routes out of EWR. These findings are valuable to supplement the ongoing antitrust investigation by the U.S. Department of Justice of this alliance.

Publication Title

Transport Policy

DOI

https://doi.org/10.1016/j.tranpol.2023.06.011

Publisher

Elsevier Ltd

Scholarly Commons Citation

Zhou, L., Yu, C., & Friedenzohn, D. (2023). Assessing the Impacts of Northeast Alliance between American Airlines and JetBlue Airways. Transport Policy, 140(). https://doi.org/10.1016/j.tranpol.2023.06.011