FlyerTalk Forums - View Single Post - Why do flights sell out?
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Old Dec 8, 2004 | 11:17 am
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BearX220
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They kind of do that already; a ticket bought the day before is usually far more expensive than one bought 60 days before.

Airlines presell inventory on a non-refundable basis for a low fixed price. I don't see how they'd adopt your model without effectively filling the plane with the 180 (+/-) highest bidders... effectively dislodging some of those early buyers. If they knew they could be outbid and tossed off a given flight close to go time, they would be less likely to buy, especially on a non-refundable basis. So the airline would book less guaranteed advance revenue for a given flight, everyone would game the bidding system eBay style, and chaos would result.

Remember that eBay is a classically irrational market -- people pay the highest possible price, not the lowest possible one. They bid up, not down. It's possibly the only pricing market more irrational than the airline ticket market.
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