Willingness to Pay for Airline Services: A Stated Choice Experiment
It is widely recognized that airlines are increasingly exposed to fierce levels of competition across all market segments, especially in the tourism segment (Gilbert and Wong 2003). Hence, it comes as no surprise that airlines have been devoting increasing attention to service differentiation strategies that seek to cater to the heterogeneous preferences of passengers (Rose et al. 2005). As a result, there is a growing body of research on stated preferences (SP) discrete choice models that are used to elicit passengers’ preferences.
As Hensher et al. (2001) argue, revealed preferences (RP) data are limited in that they are applicable in explaining current passenger choices, but are a risky domain within which to assess the potential gains from changes in fares and service levels well outside the combinations observed. Stated choice (SC) experiments have become a very popular workhorse to extend the domain of choice as defined by the attributes of alternatives through...
KeywordsState Choice Related Reason Heterogeneous Preference Stated Preference Data Fare Class
We thank support from Interreg III-B, MOVIECAM Project.
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