Key determinants of airline pricing and air travel demand in China and India: Policy, ownership, and LCC competition

Kết quả hình ảnh cho Private and low-cost airlines players in the Indian airline market images

As two of the fastest-growing economies, China and India share many similarities. However, the air transport sector of the two countries exhibits substantial differences 30 years after deregulation. Private and low-cost airlines have become dominant players in the Indian airline market while the state-owned airlines still enjoy a dominant status in the Chinese market. The econometric analysis of this research suggests that the presence of a low-cost carrier (LCC) on a route has the effect of reducing the airfare and stimulating the demand for air travel in India, no matter the LCC presence is measured by market shares or dummies. Chinese LCCs have similar competitive effects only when the LCC entry is measured by dummy variables. Airport concentration in India could lead to cost savingsand thus lower airfares, but this did not occur in China due largely to the lack of a culture of antitrust compliance.

Collected and summarized from the source below by Quynh Hoa