I don’t understand air fares
Posted December 5, 2008on:
I’ve been looking at air fares for overseas travel recently and somethign stood out. When you stop over in a city it costs a whole lot more to stop over for a few days than it does to just transfer flights and pass through. I would have thought that getting to your final destination faster was something people would pay for. Yet, the longer you’re happy to take over your trip, the more you end up paying!
Are there costs to a stop over that I’m not aware of? It doesn’t seem as if it would cost the airlines any more to put you on a flight a few days after you arrive at a destination. Indeed, I would guess that people who want to stop over and explore a city are far more flexible about the timing of their flight than those who just want to pass through as quickly as they are able. In that case, the more inelastic demand for short stop-overs should result in them costing more.
I’m sure that airlines have thought about this in some detail and there’s a good reason for it. So can anyone explain to me why staying in a city for a while is so expensive?
UPDATE We’ve had a very helpful email from a reader that sheds some light on the problem. Apparently I don’t understand because the fare system is so complex that understanding it would require solving currently unsolvable problems in computer science. It doesn’t really shed any light on the issue, but at least I don’t feel so daft any more!
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