Abstract
The current economic and political challenges such as the negative repercussions of the health pandemic and the Russian invasion of Ukraine have created an unstable economic environment and caused an energy crisis that has led to a sharp increase in inflation rates and fuel prices to record levels (World Bank, 2023). These difficult circumstances have forced airline service providers to raise their airfare in order to overcome their massive costs (IATA, 2022). Due to the high availability of switching behavior in airline travel services, travellers’ willingness to pay a price premium to airline service providers has become a critical factor for airlines’ ability to cope with these difficult circumstances. In contrast, empirical investigations about travelers’ willingness to pay a price premium and to tolerate this increase in ticket prices, especially during an economic crisis, is still very scarce. Therefore, the current study investigates the role of airline service quality and perceived value on travelers’ willingness to pay a price premium for airlines firms, and the extent to which travelers’ income and national bias towards airlines belonging to their home-countries can moderate these relationships. Data were collected from 408 international travellers using survey questionnaire and were analyzed using SEM, and multi-group analysis. The results reveal that although perceived service quality and perceived value significantly influences travellers’ willingness to pay a price premium, these effects were more prominent for high-income travellers, and more significant for national airlines compared to foreign airlines.
Presenters
Hany Ragab Ibrahim AbdelazizCairo University, Business Administration, Assistant Lecturer, Al Jizah, Egypt Ana Isabel Polo Peña
Professor, Marketing and Market Research, University of Granada, Granada, Spain
Details
Presentation Type
Paper Presentation in a Themed Session
Theme
Changing Dimensions of Contemporary Tourism
KEYWORDS
ECONOMIC CRISIS, PRICE PREMIUM
