Originally Posted by
emma dog
That one's easy... through years of experience AA has learned that on X route, the only people who want to fly at the last minute HAVE to fly at the last minute and they are willing to pay more. Dropping the price doesn't increase passengers and revenue in excess to what they lose when they no longer capture the revenue from price insensitive travelers.
Somebody was paying attention in Econ class...
The fact that AA uses the alleged last-minute-gouge model doesn't mean it's revenue-optimal, but the absence of even one other U.S. airline with a comprehensive route network using another pricing model is certainly indicative.