We examine the effect of the Alaska Airlines‐Virgin America merger on quality. Employing difference‐indifferences, we find the merger leads to an increase in delays, proportions of flights cancelled or delayed, padding, and flight time. In addition, routes with carriers overlapping pre-merger have experienced a larger quality reduction than routes without overlap. Our evidence indicates that competition helps improve quality. Furthermore, we observe a smaller increase in arrival delays in short-haul flights compared to long-haul counterparts. We document how a merger involving a hub carrier and a point-to-point network, where premerger overlap was few, could lead to some significant quality reductions.
Chuang et al. (Wed,) studied this question.