Estimation of consumer demand on the air transport market.

Summary One of the peculiarities of the airline market is the wide divergence in ticket prices for the same flights. This mainly reflects the inability of companies to easily change production volumes and/or stock them. The development and use of yield management models have focused on airlines offering different types of fares for the same flight. The objective of this thesis is to build a number of economic models to explain price dispersion in the airline market from different perspectives. In Chapter 3, I create a direct price model that explains how different product and consumer characteristics influence the price level. Chapter 4 focuses on price level differences from a competitive perspective. In a strategic game where firms compete with each other, ! In a strategic game where firms compete, the set of rationalizable strategies for each player implies all the best responses to each other's decisions. This chapter provides an empirical test for the existence of the unique Nash equilibrium in a Cournot oligopoly. In Chapter 5, I treat the air passenger market as a product-differentiating market and apply a multinomial logit model to calculate price elasticities. The logit model (with particular emphasis on consumer heterogeneity) estimates how different product characteristics influence market shares.