Asymmetric promotion and strike effects in an oligopolistic service industry

The effects of promotion and selling expenses as well as the impact of striks on the sales of two major airlines in an oilgopolistic service industry are investigated through simultaneous and recursive multiple regression modelling. Results indicate that the independent variables asymmetrically affect the respective sales of the duopolists. Additionally, there is evidence that the two firms appear to have adopted a form of competitive response model regarding their promotional expenditures which may be questionable given the results of this study.