The net profitability of airline alliances using referential dollars

Abstract

This study revises a previous research in which we analysed the net profitability of airline alliances but did not control for the impact of inflation on such profitability. Using the same methodology, 15 international airlines as subjects and their net financial results for a period of 11 years as primary research variables, we now compared the performance of airlines before and after joining their respective alliances using referential dollars (i.e., constant dollars with 2010 as base year) instead of nominal dollars. The results showed a similar deterioration in short-term net profits after joining an alliance as the previous study did, and a similar behaviour of statistics tests. Thus, the conclusion then achieved still stand after this revision.