Eastern Kentucky University Encompass Honors Theses Student Scholarship Spring 2017 Game Theory: The oM dern-Day Airline Dogfight Nathaniel Schattner Eastern Kentucky University,
[email protected] Follow this and additional works at: https://encompass.eku.edu/honors_theses Recommended Citation Schattner, Nathaniel, "Game Theory: The odeM rn-Day Airline Dogfight" (2017). Honors Theses. 447. https://encompass.eku.edu/honors_theses/447 This Open Access Thesis is brought to you for free and open access by the Student Scholarship at Encompass. It has been accepted for inclusion in Honors Theses by an authorized administrator of Encompass. For more information, please contact
[email protected]. EASTERN KENTUCKY UNIVERSITY Game Theory: The Modern-Day Airline Dogfight Honors Thesis Submitted in Partial Fulfillment of the Requirements of HON 420 Spring 2017 By Nathaniel Schattner Faculty Mentor Dr. Frank O’Connor Department of Government and Economics Schattner 2 Abstract Game Theory: The Modern-Day Airline Dogfight Nathaniel Schattner Dr. Frank O’Connor Department of Government and Economics This study examines the narrowing differentiation between legacy airlines and low-cost carriers in the United States by exploring the competitive strategies each group borrows from one another. Specifically, this work examines the implementation of a new type of economy fare by Delta Air Lines, called basic economy, and evaluates how the fare has impacted a key metric of airline performance: domestic operating revenues. In the first part of this thesis, an explanation of the history behind airline marketing efforts as well as what constitutes a low-cost carrier and a legacy carrier is provided. A brief description of game theory is included as well.