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14. In 2018, two regional airline carriers, Alaska Airlines and Virgin America, agreed to merge into one larger airline under the Alaska Airlines name. Although
14. In 2018, two regional airline carriers, Alaska Airlines and Virgin America, agreed to merge into one larger airline under the Alaska Airlines name. Although the merger would reduce the number of airlines serving the U.S. market, and hence raise the HII, the argument made by Alaska Airlines is that the overall airline industry would become more competitive, not less. Take a look at Alaska Airlines's and Virgin America's old route maps (they can be searched using Google) and compare them to the current Alaska Airlines route map. How might the larger airline be a more competitive player in the airline market? Because a larger airline will shift the airline market into a perfectly competitive market where every firm will be a competitive firm Because a larger airline can attract more customers and increase its market share to a level similar to that of other leading airlines O Because a larger airline will shift the airline market into a monopoly Because the new HHI will be above 2,500
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