The impact of Southwest Airlines on Commercial Aviation Research Paper

The impact of southwestern United States Airlines on Commercial Aviation - Research Paper Example311). Along the way, it refined its low price scheme by cutting down on food and beverage offerings, mandating open seating which increases capacity, flying merely one type of plane, locking in low fuel prices when the fuel prices spiked in 2008, and favoring secondhand markets such as Chicago Midway over congested markets, such as Chicago OHare. These strategies helped Southwest cut prices, and the result of Southwests ability to slash prices has been nothing short of astounding on the entire airline industry, resulting in fare cuts across the board, and substantially increasing airport art for the airports that serve Southwest in relation to airports that do not. The result of the impact of Southwest Airlines on the airline industry has been so significant that it was given a name the Southwest Effect.Different studies down done different analyses on the Southwest Effect. Morris on (2001) performed a study on the aggregate effect of Southwest on Southwests competition, then compared the aggregate estimate with fare reductions that were the result of deregulation, as a way to quantify Southwests effect on the success of deregulation (Morrison, 2001, p. 241).Morrison stated that the airfares on a given route are influenced by an different airline in three ways. First, is when the other airline serve a given route second, when the other airline serves an adjacent route that is seen by consumers to be a reasonable alternative to the first route and third, the other airline affects fares if the existing airlines on a route lower their fares in order to keep out potential competitors (Morrison, 2001, p. 241). Morrison quantified Southwests impact on each of these categories, stating that there was a potential for Southwest to impact 94% of domestic help passenger miles (Morrison, 2001, p. 243). His unit of measurement for this impact was an equation