Pricing effects of code-sharing in Africa

• Published in: Economics of transportation (England) 2024-09, Vol.39, p.100369, Article 100369
• Main Authors: Gualini, Andrea, Ogliari, Laura, Martini, Gianmaria, Scotti, Davide
• Format: Article
• Language: English
• Subjects: African air transportation; Code-sharing agreements; Pricing effects
• ISSN: 2212-0122
• DOI: 10.1016/j.ecotra.2024.100369

This study investigates the impact of code-sharing (CS) agreements on airfares in Africa, a region largely overlooked in existing airline cooperation research. Analysing a comprehensive dataset covering international one-stop routes in Africa from 2017 to 2019, we examine the direct effects of CS agreements on connecting itinerary discount economy fares that swap from interline to CS. Additionally, we explore the spillover effects of airlines adopting CS on the fares of those that do not implement it. Our key findings reveal that the implementation of CS agreements results in an approximately 18% reduction in airfares for African international routes. Furthermore, we identify a negative spillover effect, demonstrating reduced airfares for interline itineraries by 12% when rival pairs adopt CS, while online and direct itineraries experience smaller reductions (around 4%). •Investigates the impact of code-sharing on airfares in Africa.•Code-sharing leads to an 18% reduction in airfares for African international routes.•Negative spillover effect: reduced airfares for interline itineraries by 12% when rivals adopt CS.•Suggests that increased cooperation between airlines can improve the African aviation market.