The Regulatory Impact on Provided Quality in the Aviation Sector – A Quantitative Examination based on the Difference-in-Difference Method
In 2005, EU rule 261/2004 was introduced in order to strengthen passenger rights in air-travel across Europe by imposing significant consumer compensation rights for inadequate services. This paper aims to examine the development after imposing this regulatory act by comparing the changes in punctua...
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| Format: | Dissertation (University of Nottingham only) |
| Language: | English |
| Published: |
2016
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| Online Access: | https://eprints.nottingham.ac.uk/36144/ |
| Summary: | In 2005, EU rule 261/2004 was introduced in order to strengthen passenger rights in air-travel across Europe by imposing significant consumer compensation rights for inadequate services. This paper aims to examine the development after imposing this regulatory act by comparing the changes in punctuality as proxy for quality for affected (EU) and unaffected (non-EU) airlines. Statistical tests based on the difference-in-difference estimation reveal that affected airlines exhibit higher punctuality ratios in contrast to US airlines after the regulation was imposed. This effect is stronger for low-budget airlines, but weaker on competitive routes and during summertime. Non-US airlines increase their punctuality even more in contrast to airlines tied to the regulation. |
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