Southwest Airlines worsens other incumbent firms' on-time performance

Research finds that incumbent on-time performance worsens in response to entry by superior on-time performance firms. 10.09.10 Prince and Daniel have examined if and how incumbent firms respond to entry, and entry threats, using non-price modes of competition. Their analysis shows that incumbent on-time performance actually worsens in response to entry, and even entry threats, by Southwest Airlines.  If an airline with an average on-time performance (Continental) threatens to enter or enters a route, there is no notable response by incumbents. Paper: Prince, J. & S.H. Daniel (2010) 'Do Incumbents Improve Service Quality in Response to Entry? Evidence from Airlines' On-Time Performance'