Sunday, October 27, 2002

"Brazen Trade Marks New Path of Enron Probe", WSJ, October 21 2002. [Categories: Game Theory] 12:19:07 PM    comment []

"United They Fall", WSJ, October 21 2002. Apologies the salary table didn't come out well.  Bottom line: United pilots make from $129K -- $306K, others such as Northwest pay from $100K -- $220K, Southwest pays from $87K to $152K, and at the bottom American Trans Air pays from $46K to $110K.  Why does the pilot's union at Northwest gain bargaining strength when United decides to pay its pilots more?  After all, the Northwest pilots aren't likely to be able to switch over to United.  [Categories: Airlines, Costs, Game Theory] 12:12:36 PM    comment []

"Web Effect is Greater on Airline Revenue Than Costs", WSJ, October 17, 2002.  Do you agree with this article's analysis?  If so, what should airlines do now vis-a-vis their internet strategy? [Categories: Airlines, Costs, Market Definition, Price Discrimination] 12:03:52 PM    comment []

"Industrial Gases: Pressure Builds in Recession" and 'The Middle East: Natural Advantages Fuel Increasing Investment", Financial Times Special Section: The Business of Chemicals, October 14 2002.  First article: As we learned in class, one potential advantage of servicing is that it provides a means to meter customer consumption and hence to price disriminate through a two-part tariff.  Is this feature important, do you think, to industrial gas providers, say, supplying bars and clubs? [Categories: Price Discrimination] Second article: Apparently, the Middle East commitment to expand capacity has deterred others from expanding.  Can we conclude, then, that expected future gas prices given the Middle Eastern expansion are lower than what would be necessary to justify present investment by other, higher cost producers?  What if the Middle East had a smaller cost advantage?  Could they still deter expansion by others in the face of expected high future prices? [Categories: Costs, Game Theory] 11:58:25 AM    comment []