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Pricing with flexibility as vertical product differentiation and peak-load pricing

Larsson, Tom LU (2012) NEKH01 20121
Department of Economics
Abstract
Introducing flexibility as a factor that determines prices is something that is possible by giving different types of contracts different levels of flexibility. This is in particular very apparent when one starts to analyze domestic flight tickets.
The flight ticket is today a good that is vertically differentiated and this thesis will address the problem of pricing with flexibility as vertical product differentiation. It is found that the tickets are vertically differentiated with flexibility and that the level of flexibility is a significant factor pricing flight tickets.
Peak load pricing is a theory that suggests the airline to increase the prices when they are facing an increasing demand for a group of tickets. These tickets are... (More)
Introducing flexibility as a factor that determines prices is something that is possible by giving different types of contracts different levels of flexibility. This is in particular very apparent when one starts to analyze domestic flight tickets.
The flight ticket is today a good that is vertically differentiated and this thesis will address the problem of pricing with flexibility as vertical product differentiation. It is found that the tickets are vertically differentiated with flexibility and that the level of flexibility is a significant factor pricing flight tickets.
Peak load pricing is a theory that suggests the airline to increase the prices when they are facing an increasing demand for a group of tickets. These tickets are found in the peak hours where the demand for tickets is higher than usual. This thesis will define these hours and find that such a pricing strategy is more significant the closer the departure date. (Less)
Please use this url to cite or link to this publication:
author
Larsson, Tom LU
supervisor
organization
course
NEKH01 20121
year
type
M2 - Bachelor Degree
subject
keywords
Flexibility, Peak load pricing, Vertical product differentiation
language
English
id
2607598
date added to LUP
2012-06-15 11:19:54
date last changed
2012-06-15 11:19:54
@misc{2607598,
  abstract     = {Introducing flexibility as a factor that determines prices is something that is possible by giving different types of contracts different levels of flexibility. This is in particular very apparent when one starts to analyze domestic flight tickets.
The flight ticket is today a good that is vertically differentiated and this thesis will address the problem of pricing with flexibility as vertical product differentiation. It is found that the tickets are vertically differentiated with flexibility and that the level of flexibility is a significant factor pricing flight tickets.
Peak load pricing is a theory that suggests the airline to increase the prices when they are facing an increasing demand for a group of tickets. These tickets are found in the peak hours where the demand for tickets is higher than usual. This thesis will define these hours and find that such a pricing strategy is more significant the closer the departure date.},
  author       = {Larsson, Tom},
  keyword      = {Flexibility,Peak load pricing,Vertical product differentiation},
  language     = {eng},
  note         = {Student Paper},
  title        = {Pricing with flexibility as vertical product differentiation and peak-load pricing},
  year         = {2012},
}