The valuation of direct intercontinental flights as opposed to non-direct ones : Insights based on a hedonic apporach
Type
conference paper
Date Issued
2007-06-21
Author(s)
Abstract
This paper is about valuating direct intercontinental flights as opposed to non-direct ones, taking an individual travelers' perspective. The methodology of this study is derived from a hedonic approach which tries to explain actual expenditures (in our case of air transport) by means of a number of non-divisible characteristics (origin and destination, number of stopovers, choice of travel class).
The results reveal that direct flights are valued higher than non-direct ones. However, the share of this advantage in relation to other characteristics by which a flight can be valued is limited, ranging from 15 to 20 per cent (in the context of travel in economy class; ceteris paribus) to less than 10 per cent (in the context of travel in business class; ceteris paribus). In contrast, and to put those numbers into perspective, choosing business class (instead of economy) adds 240% to an economy air fare (ceteris paribus).
The results reveal that direct flights are valued higher than non-direct ones. However, the share of this advantage in relation to other characteristics by which a flight can be valued is limited, ranging from 15 to 20 per cent (in the context of travel in economy class; ceteris paribus) to less than 10 per cent (in the context of travel in business class; ceteris paribus). In contrast, and to put those numbers into perspective, choosing business class (instead of economy) adds 240% to an economy air fare (ceteris paribus).
Language
English
Keywords
flight characteristics valuation
hedonic approach
direct flight
air transport pricing
HSG Classification
contribution to scientific community
Refereed
No
Event Title
11th Air Transport Research Society (ATRS) Conference
Event Location
Berkeley, USA
Event Date
21.-23.06.2007
Subject(s)
Eprints ID
243864
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ATRS2007_Bieger_Laesser_Wittmer.pdf
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447.84 KB
Format
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