Why Do Airlines Think Bigger is Always Better?

I was listening to a podcast of last night’s edition of Marketplace on the way into work this morning, where they discussed the proposed merger of U.S. airlines United and Continental. If the merger were to go through, it would create the worlds largest air carrier.

I find it very telling that when faced with hard times the instinct of “Big Business” is to become even bigger. Never mind that smaller, leaner carriers like Southwest and JetBlue are the ones who are actually making money…

This just reinforces my thought that mergers of this type are action of last resort for businesses who are completely out of actual ideas.