The effect of strategic alliance on performance

Abstract

This study investigates codesharing alliances to see if they increase market shares of the carriers involved by analyzing a time-series data of 56 airlines over the 1986–1993 period. Our empirical results indicate: (a) codesharing, in fact, increases the carriers' market shares; (b) codesharings between existing airlines increase market shares less than those between relatively new carriers; and (c) the market-share-increasing effect of codesharing alliance is higher in markets with fewer competing carriers.