You (expect to) get what you pay for: A system approach to delay, fare, and complaints

In this paper, an analytical framework integrating delay, fare, and complaints with passenger air travel has been laid out. Examining aggregate monthly data for US domestic air travel, we have identified causal relationships among fare, complaints, and levels of delay. An analytical framework is proposed that formalizes these relationships in an integrated manner. This integrated framework is then estimated in a set of simultaneous equations by using 118 months of data from January 1997 to October 2006. Results show that complaints are influenced by levels of delays. However, complaints are positively influenced by average yield. These findings lead us to support the central hypothesis that complaints are responsive to levels of delays, but they tend to vary according to fare. That is, air travelers are less likely to complain in return for lower fares, even when faced with the same or even higher levels of delays. These findings have important policy implications, including the passengers’ bill of rights and regulator’s choice between market and operational performances.