  We investigate the allegation that legacy U.S. airlines communicated via
earnings calls to coordinate with other legacy airlines in offering fewer seats
on competitive routes. To this end, we first use text analytics to build a
novel dataset on communication among airlines about their capacity choices.
Estimates from our preferred specification show that the number of offered
seats is 2% lower when all legacy airlines in a market discuss the concept of
"capacity discipline." We verify that this reduction materializes only when
legacy airlines communicate concurrently, and that it cannot be explained by
other possibilities, including that airlines are simply announcing to investors
their unilateral plans to reduce capacity, and then following through on those
announcements.
