The Effect of Disruptions on Service Quality ity and Market Share: Evidence from the US Domestic Airline Industry

摘要

The purpose of this paper is to investigate the effect of disruptions on service quality and marketshare in the US domestic airline industry. Structural equation modeling (SEM) was used toempirically test the effect of disruptions on service quality and market share for the network andlow cost airlines. Our findings suggested that network airlines can manage disruptions moreeffectively than low cost airlines. While disruptions have a negative effect on service quality forboth network and low cost airlines, their effect on airline market share is different. Disruptionshave a significant (negative) effect on market share for the low cost airlines while they do notappear to impact market share for the network airlines. We used multi-group analysis ofinvariance to compare the effect of disruptions on service quality and market share betweenairlines. The analysis showed that the effect of disruptions on service quality and market share isdifferent between airlines. Based on the findings of this study recommendations for managers inthe airline industry have been provided.