Affiliation:
1. University of Cantabria, Spain
Abstract
The COVID-19 outbreak has brought an unprecedented crisis in both the tourism travel and aviation sectors. Understanding how firms compete guaranteeing mobility in an uncertain situation like the current one is a fundamental question in the field of socioeconomic planning and development. Using two-stage least squares (2SLS) regression analysis, this research studies the relationship between the incidence of COVID-19 in tourism destinations and the airline pricing policy. To this end, big data and business analytics techniques were used to obtain 2,668 price observations from 13 European airports to the five main Spanish sun and beach destinations. The results suggest a high inverse relationship between the incidence of the virus in the destination region and the mobility and price of the airline ticket. Other factors like economic activity, fleet capacity, and the distance between origin and destination have also been decisive in airlines' price-setting strategies during the current pandemic.