Meditations and Learnings

Meditations and Learnings

The Economics of Travelling Off-Peak

Travel companies build and purchase planes and cruise ships to handle demand at peak volume. Therefore they have the excess, unutilised capacity in periods of lower demand. Retirees have the freedom to travel during these times of the decreased market. They can capitalise on the businesses’ desire to make money off from the spare seats or rooms that would otherwise remain empty. The opportunity cost of the unused capacity is whatever the passenger is willing to pay minus the minimal costs of serving them.