Claudio A. Piga

Università degli Studi di Genova | UNIGE · Dipartimento di Economia - DIEC

Using data from about 25 million hotel room postings in four countries, we document that rather than decreasing to zero as the likelihood of cancellation declines, the difference between the prices for refundable and nonrefundable reservations remains positive at roughly 10%–15% of the full price. A model where travelers have different willingness...

Using novel data on the pricing for hotel rooms in Paris during the summer of the 2016 European Football Cup, we document the co-existence of uniform and bespoke pricing within the same industry and even within the same firm. Although stay dates have heterogenous potential demand, hotels initially price them uniformly. However, as time goes by, the...

Cooperation in innovation activities is a key building block in forming entrepreneurial innovation networks. However, the impact on innovation of different forms of cooperation among multiple stakeholders composing a firm’s relational environment can be dramatically different, depending on whether the modalities of cooperation are tacit or explicit...

When a firm can sell multiple units before any price adjustment takes place, three forces may affect the pricing of the inventory over time: perishability drives prices down, scarcity shifts prices up, and intertemporal price discrimination raises prices. Hidden prices arise because each unit, even if not immediately up for sale, is assigned a pric...

This paper investigates hoteliers’ short-term recovery strategies during the pandemic. Stemming from management crisis theory and the resource-based view of the firm, this article focuses on two environments differently hit by COVID-19, i.e. London and Munich. The findings show that hotels with a more managerial approach have more proactively appli...

Purpose Focusing on two beer festivals held in Nottingham, England, this study aims to evaluate their indirect impact on the performance of city hotels. This study builds on theoretical insights from the revenue management literature to shed empirical light on the potentially beneficial effects of events on the hotels’ performance. This study inves...

Online platforms often impose Price Parity Clauses to prevent sellers from charging lower prices on alternative sales channels. We provide quasi-experimental evidence on the full removal of Price Parity Clauses in France in 2015 for hotels listed on Booking.com. Our analysis reveals significant price decreases in the short run, but a more limited e...

We explore the role of government initiatives fostering entrepreneurship—in the form of tax advantages and government support—in influencing the probability that entrepreneurial firms obtain bank credit and are not discouraged from applying for a loan. We propose that government initiatives fostering entrepreneurship should allow entrepreneurial fi...

We review the importance of the revenue management (RM) system in the airline industry, focusing on cost-leader companies. We show that RM of low-cost carriers, which looks simple at a first glance, is indeed quite a sophisticated tool for extracting value from different demand segments, and thus, it is, for all intents and purposes, a capability i...

If flight fares cannot be continuously and instantaneously updated, then there exist 'static pricing' spells that the airlines manage by defining a fare for the entire flight's capacity, i.e., a fare distribution. Evidence indicates static spells' duration depends on a flight's load factor, its selling rate and the time to departure. Overall, no su...

In this paper, we study whether competition in the airport market and the vertical interactions between upstream airports and downstream airlines influence the airport pricing decisions. Using a panel of the 24 largest UK airports, as well as a refined definition of airports’ market structure, we find that lower concentration in an airport’s catchm...

This paper studies the contrasting effects on innovations and productivity arising from active cooperation in innovation activities among competitors and from passive cooperation induced by these activities’ spillovers. A three-stage productivity function is estimated showing that firms’ innovations are supported by their active cooperation within...

We analyse the fare setting strategy of a leading European low-cost carrier, Ryanair, which, until recently, adopted an unsegmented pricing policy (all tickets belong to a single fare class). We show that, to account for different demand characteristics, the company adjusts the two main components governing the dynamics of posted fares, namely time...

An often disregarded, albeit central, aspect of the airline pricing's problem consists in assigning a fare to all the available seats on an airplane at the beginning of and during the whole booking period. We show how a flight's fare distribution is set in practice and how it changes over time using evidence from a leading European low-cost carrier...

Based on two strands of theoretical research, this paper provides new evidence on how fares are jointly affected by in-flight seat availability and purchasing date. As the capacity-based theories predict, it emerges that fares monotonically and substantially increase with flight occupancy. After controlling for capacity utilization, our analysis al...

This report studies the micro-evidence on innovation activity at firm level in the UK. The main aim of this report is to assess the network effects generated by individual firms’ decisions on intangible innovation activities, such as investing in internal and external R&D activities, training and advertising for the purpose of innovation. The netwo...

This paper examines mergers that lead to an almost immediate replacement of the target firm's business model in favor of that of the acquiring firm. We examine the post‐merger behavior of the two leading European dedicated low‐cost airlines, EasyJet and Ryanair, each acquiring another low‐cost airline, Go Fly and Buzz, respectively. We find that bo...

During the last decade, the proliferation of Low Cost Carriers and the related huge increase in traffic has been the most visible effect of the deregulation of the airline market in Europe. Little attention has been paid to how airports were affected by the changes in the new institutional environment. In this study we model the total factor produc...

We analyze two different cases of entry regulation in professional markets: first, when licensing is a requirement for becoming a professional (lawyers); second, when entry and price restrictions are applied on a geographical basis (pharmacists). Both cases are investigated within a circular model of localized competition and heterogeneous players....

During the last decade, the proliferation of Low Cost Carriers and the related huge increase in traffic has been the most visible effect of the deregulation of the airline market in Europe. Little attention has been paid to how airports were affected by the changes in the new institutional environment. In this study we model the total factor produc...

Based on two strands of theoretical research, this paper provides new evidence on how fares are jointly affected by in-flight seat availability and purchasing date. As capacity-driven theories predict, it emerges that fares monotonically and substantially increase with the flights occupancy rate. Moreover, as suggested in the literature on intertem...

This paper investigates the link between firms' geographic configuration and market power in imperfect markets. We consider two related setups. The first illustrates the relevant characteristics of the pricing equilibrium. A main implication is that the equilibrium price vector changes in accordance with the firms' spatial configuration. The second...

This paper analyzes the empirical relationship between market structure and price dispersion in the airline markets connecting the U.K. and the Republic of Ireland. Price dispersion is measured by the Gini coefficient, calculated using fares posted on the Internet at specific days before takeoff. We specifically control for passengers' heterogeneit...

We collect data on published fares for the route London-Amsterdam to shed some light on the pricing practices of low-cost and legacy carriers, when operating in a large and crowded market. We investigate the reach of two strategies of segmentation involving the time before departure the ticket has been bought (inter-temporal segmentation) and the d...

This paper presents a new form of online pricing tactic where airlines post, at the same time and for the same flight, fares in different currencies that violate the law of One Price. Unexpectedly for an online market, price dispersion may be accompanied by a hidden discount that tends to persist in the period preceding a flight’s departure. The ec...

Traditional theories of airline pricing maintain that fares monotonically increase as fewer seats remain available on a flight. A fortiori, this implies a monotonically increasing temporal profile of fares. In this paper, we exploit the presence of drops in offered fares over time as an indicator of an active yield management intervention by two ma...

This paper investigates the properties of two types of cost restrictions that guarantee the existence of an equilibrium in pure strategies in Bayesian spatial competition models with heterogeneous firms.

Using unique data on a low-cost airline posted prices and seat availability, this study sheds some light on whether the airline's actual practice of yield management techniques con- forms with some predictions from economic models of peak-load pricing under demand uncertainty. On the one hand, robust support is found to the notion that prices incre...

Children in households reporting the receipt of free or reduced price school meals through the National School Lunch Program (NSLP) are more likely to have negative health outcomes than eligible nonparticipants. Assessing the causal effects of the program is made difficult, however, by the presence of endogenous selection into the program and syste...

Children in households reporting the receipt of free or reduced price school meals through the National School Lunch Program (NSLP) are more likely to have negative health outcomes than eligible nonparticipants. Assessing the causal effects of the program is made difficult, however, by the presence of endogenous selection into the program and syste...

The authors analyse the entry and exit activity in the UK-Europe airline markets and study the differential traits of three main airlines (British Airways, EasyJet and RyanAir) during1997-2004. They find that entry and exit are more likely in large markets and in markets with a high number of incumbents. Already operating in the city- pair enhances...

We study when a monopolistically-competitive firm may optimally choose to limit the size of its market. This may be the case when the cost of serving the market with geographically dispersed customers is increasing in size. We also investigate the incentives faced by a firm to limit the reach of its market when it adopts two different pricing schem...

We study the relationship between pricing and market structure on the routes connecting the UK and the Republic of Ireland. Because in 2007 the European Commission prohibited the takeover of Aer Lingus by Ryanair, the analysis focuses on their pricing strategies in particular. We use an original dataset of fares posted on-line, which allows to cont...

The paper extends the Salop model of localized competition by allowing firms to have heterogeneous costs. We provide a general but highly tractable analytical solution for the equilibrium prices, and we study the long-run properties of the model using two different entry games. We show that cost heterogeneity affects the efficiency of the market eq...

We study whether a firm’s total factor productivity dynamics is positively influenced by its own R&D activity and by the technological spillovers generated at the intra- and inter-sectorial level. Our approach corrects simultaneously for the endogeneity and the selectivity biases introduced by the use of a firm’s own R&D as a regressor. A firm’s in...

We introduce an on-line pricing tactic where airlines post, at the same time and for the same flight, fares in different currencies that violate the law of One Price. Unexpectedly for an on-line market, we find that price discrimination may be accompanied by arbitrage opportunities and that both tend to persist before a flight’s departure. We find...

Using evidence from an original dataset of more than 12 million fares, this study sheds light on two issues relating to the pricing behaviour of the main European airlines: 1) the extent to which an airline’s dominant position at the origin airport, at the route and the city-pair level affects the airlines’ market power; 2) whether fares follow a m...

We study whether R&D-intensive firms are liquidity constrained, by modelling their antecedent decision to apply for credit. This sample selection issue is relevant when studying a borrower–lender relationship, as the same factors can influence the decisions of both parties. We find firms with no or low R&D intensity to be less likely to request ext...

We analyse the entry and exit activity in the UK airline markets in the post-liberalisation period and study the differential traits between traditional and low cost carriers. Alongside with the characteristics traditionally highlighted as determinants of entry (e.g., airport presence and network economies), we find that the existence of charter or...

This is a working papeer. It is also available at: http://ideas.repec.org/p/lbo/lbowps/2006_14.html. It is often assumed that the airlines’ fares increase monotonically over time, peaking a few days before the departure. Using fares for about 650 thousand flights operated by both Low-Cost and Full Service Carriers, we show several instances in whic...

We analyze the entry and exit activity in the European Airline Markets in the post-liberalisation period and study the differential traits between traditional and low cost carriers. Alongside with the characteristics traditionally highlighted as determinants of entry (such as airport presence and network economies), we find that the existence of ch...

Technological innovation and the decreasing costs of wireless and other technologies, combined with progressive policy and regulatory environments, have resulted in the provision of telecommunication services in remote areas thought unserviceable by incumbent telcos in Latin America, Central Europe, and Asia. In line with the increasing number of s...

Children in households reporting the receipt of free or reduced price school meals through the National School Lunch Program (NSLP) are more likely to have negative health outcomes than eligible nonparticipants. Assessing the causal effects of the program is made difficult, however, by the presence of endogenous selection into the program and syste...

We present a three-stage game where two firms choose location, R&D and price, under the assumption that R&D spillovers depend on firms' location. That is, the closer firms are to each other, the greater the benefit they receive from their rivals' efforts in quality-enhancing R&D. We show that the distance between firms' location increases with the...

The purpose of this study is to examine the impact of joint research projects with universities on a firm's growth in total factor productivity (TFP). First, a reduced-form version of the research and development (R&D) capital stock model is estimated.This econometric model is evaluated in light of data from a 1998 survey of 2,222 manufacturing fir...

Ed Mansfield wrote several papers on the private returns to basic research (e.g. Mansfield, 1980) and the influence of academic research on industrial innovation (e.g. Mansfield, 1991). We extend this line of research by assessing the impact of university research on total factor productivity growth of Italian manufacturing firms. The econometric a...

This study underlines that the decision to enter into an external R&D relationship is related to an antecedent decision to carry out R&D. This calls for an empirical approach that permits the joint analysis of the determinants of the two decisions, correcting for sample selectivity. Based on a sample of Italian manufacturing firms, the results conf...

We use firm-level data from Italian manufacturing firms to assess the relationship between various types of R&D and total factor productivity growth, including collaborative research with other firms and universities. A novel twist to our empirical analysis is that we estimate a treatment effects model, which enables us to treat the decision to con...

We present a model of spatial price discrimination where R&D spillovers are endogenous as they depend on firms' location. We establish that both the distance between locations and R&D efforts are an increasing function of the transportation cost coefficient and show that there is a continuum of cases where firms will choose an intermediate location...

We model a vertical relationship between two firms. Our main finding is that the downstream firm manipulates the extent of its debt in order to affect in its favour the contract offered by the upstream firm. Except for a very high interest rate, we find a conflict of interest between the two firms with regard to the extent of debt. This can be inte...

In questo lavoro l’analisi degli spillover si è concentrata sulle esternalità fra le impre-se italiane del tipo intra- e inter-industry ed i loro effetti sulla produttività. Le rela-zioni tra i vari settori sono state approssimate attraverso una matrice degli scambi commerciali. I principali risultati sono i seguenti:  un importante effetto degli...

We present a model of spatial price discrimination where R&D spillovers are endogenous as they depend on firms' location. We establish that both the distance between locations and R&D efforts are an increasing function of the transportation cost coefficient and show that there is a continuum of cases where firms will choose an intermediate location...

This study uses firm level data from two detailed surveys of Italian manufacturing firms to study the relationship between R&D expenditures and productivity growth. The analysis considers the different contributions of various forms of R&D (product, process, internal, external in collaboration with universities, research centres and other firms) to...

A burgeoning literature on "skill-biased" technological change (SBTC) reveals that investment in information and communications technology (ICT) is associated with workforce reductions and an increase in the demand for highly educated workers. Based on extensions of the neo-classical paradigm, researchers have also come to realize that the implemen...

The paper studies the characteristics and the effects of a tax imposed by a local government on the land used to create new tourists' accommodations. First, a dynamic policy game between a monopolist in a tourist area and a local government is considered. In each period the former has to decide the size of land undergoing development, whereas the l...

An economic model of land taxation involving a local government and a private developer constitutes the theoretical framework in this research. The model hinges around a two-tier approach including both a conservation and an efficiency criterion. The analysis indicates that sustainable tourism calls for the use of land taxation and planning legisla...

This article treats the selectivity issue in the analysis of cooperative R&D and also presents some new results, e.g. that a firm's organization, vertical relationships and innovation strategy are important drivers of a decision to engage in R&D both independently and with external partners.

We argue that it may be inappropriate to study whether high-tech firms are liquidity-constrained, without first modeling their antecedent decision to apply for credit. This sample selection issue is relevant when studying a borrower-lender relationship, as the same factors can influence both the demand and the supply side. E.g., we find firms engag...

Traditionally, R&D studies focus on organisational characteristics and internal context factor effects on a firm's R&D activities. This paper extends previous research by analysing firm–level R&D expenditures in the wider context of inter–organisational networks. Using sample of 2002 manufacturing firms in Italy, it provides evidence that R&D inten...

Low cost airlines, born more than 20 years ago in the US, have experienced in the last years a fresh start in UK and, more recently, in other European countries. This paper reviews the main characteristics and perspectives of the low cost segment of the airline industry. The original business model adopts a "light" and original organizational form,...

This paper can be downloaded without charge at: The Fondazione Eni Enrico Mattei Note di Lavoro Series Index: http://www. feem. it/web/activ/ activ.html Social Science Research Network Electronic Paper Collection: http://papers. ssm.com/abstmct id=XXXXXX The opinions expressed in this paper do not necessarily reflect the position of Cooperation in...

Theories that predict the strategic use of debt by players engaged in a verticalrelationship are tested using an empirical model of debt usage. It is found thatfirms selling mainly to other firms are characterised on average by a higherlevel of debt. No evidence supports the notion that buyers increase their leverageto commit themselves not to beha...

The first part of the paper develops a theoretical framework for the analysis of strategic behaviour of European Low Cost Airlines that emphasises the role of product differentiation. The second part uses original survey data to assess the effectiveness of Low Cost Airlines ’ distribution strategies. Finally, an econometric model is developed to as...

We study a vertical relationship between two firms, and we show that the extent of the downstream firm's borrowing affects the contract offered by the upstream firm. We establish a negative relationship between the level of debt and the downstream firm's probability of bankruptcy. We also show that, unless the interest rate is very high, there exis...

This is Restricted Access. The article was published in the journal, International Journal of Industrial Organization [© Elsevier] and is available at: http://www.sciencedirect.com/science/journal/01677187. This paper develops a differential duopolistic game where price is sticky and firms can invest in market-enlarging promotional activities which...

A deenition of sustainable development focuses on the trade-oo between the intra and intergenerational types of equity. Such a dynamic trade-oo is at the centre of the paper, which describes a policy game between a monopolist in a tourist area and the local government, who acts as a Stackelberg leader. In each period the former has to decide the si...

This paper analyses a differential game of duopolistic rivalry through time where firms can use advertising and price as competitive tools. Two cases are considered whereby: (1) advertising has the main effect of increasing market size and firms differ in production efficiency; (2) advertising has both predatory and cooperative effects in a symmetr...

A vast and often confusing economics literature relates competition to investment in innovation. Following Joseph Schumpeter, one view is that monopoly and large scale promote investment in research and development by allowing a firm to capture a larger fraction of its benefits and by providing a more stable platform for a firm to invest in R&D. Ot...

We study whether R&D-intensive firms are liquidity-constrained, by also modeling their antecedent decision to apply for credit. This sample selection issue is relevant when studying a borrower-lender relationship, as the same factors can influence the decisions of both parties. We find firms with no or low R&D intensity to be less likely to request...

The obvious decrease in the Italian export world share in the last few years has pushed economists to fmd a plausible diagnosis for the apparent decline of the Italian model of specialization. On the basis of theoretical considerations and empirical evidence, we support the view that there is a need for a so called "competitive triangle", made by l...

We present a form of on-line price discrimination where airlines charge, at the same time and for the same flight, fares in different currencies that violate the law of One Price. Unexpectedly for an on-line market, we find that price discrimination may be accompanied by arbitrage opportunities and that both tend to persist for long periods before...

Combining the resource-based view and institutional perspectives this paper develops an integrated framework for the analysis of R&D propensity and intensity. Tests on the antecedents of R&D are carried out in relation to the interactive effects of firm characteristics, industry factors and positioning within the industrial network. Important findi...

This working paper is also available at: http://ideas.repec.org/p/lbo/lbowps/2006_8.html. Using more than 10 million on-line fares, we study the determinants of yearly fares’ changes in June 2002-June 2005. We verify whether airlines took advantage, after the Euro introduction, of potential inflationary pressures by increasing their fares more in r...

Thesis (Ph. D.)--University of York, 2000.

We present a three-stage game where two firms choose location, R&D and price, under the assumption that R&D spillovers depend on firms' location. That is, the closer firms are to each other, the greater the benefit they receive from their rivals' efforts in quality-enhancing R&D. We show that the distance between firms' location increases with the...

The link will show the work in progress I have posted on RePEc - Ideas

We analyze two different cases of entry regulation in liberal professions: first, when licensing is a requirement for becoming a professional (lawyers, doctors); second, when entry and price restrictions are applied on a geographical basis (pharmacists). Both cases are investigated with a circular model of localized competition and heterogeneous pl...