Airfares

In the news today, there was a story about airfares. It said that prices would go up because the fervor over the airline mergers was dying down (US Airways' bid for Delta was definitively rejected). The story suggested that airfares would go up because the airlines would lose out on synergies that could be utilized through company combinations.

That's weird, because just a few weeks ago, news sources were saying that airline mergers would cause airfares to go up, because the mergers would cause there to be fewer airlines in the industry. Less competition would lead airlines to raise fares.

So, which is it? Airline mergers lead to higher fares. And, the lack of mergers will lead to higher fares. Apparently, it doesn't matter what happens in the industry, airfares will increase. And there's nothing that anyone can do about it ....