Discussion

attention and sources of legitimization also is important in understanding part of the difference in making sense of the prices. Albatros enacts that the prices are a way to further tourism, and therefore the prices are justified through the responsibility of Air Greenland. On the other hand, the accusation from Air Greenland that the other airlines ‘think that they can earn some money in the future’ can actually be true even from the perspective of the Tourism logic. If these airlines like Albatros (and Greenland Travel) believe in the growth potential of tourism in Greenland, then maybe they can increase their earnings in the future. However, from the Tourism perspective this growth does necessarily happen at the expense of Air Greenland due to the believe in the potential increasing tourism. Air Greenland on the other hand sees little potential in tourism and Albatros and the low price is dependent on ‘that they shall give us something at another time’. In the perception of the Airline logic this ‘something’ will probably not come, because they have little faith in tourism growth potential.

Our paper goes beyond extant research and illustrates that outside the structured space of an experiment, it is difficult to separate the different types of arguments from each other, since both the market price or reservation price as well as the price that shares profit often functions as the reference point for e.g. a fair price, and the difference reference points are invoked by both of the logics. Thus, the case study provides empirical illustration of the general point made by Kahneman et al. (1986) that: ‘Disagreements about fairness are most likely to arise when alternative reference points can be invoked, each leading to a different assessment of the participants' outcomes.’ (Kahneman et al., 1986; p. 730). Just as Kahneman et al. (1986) we can conclude that agreement on general principles of fairness therefore does not preclude disputes in Air Greenland exactly because many reference points can be and were mobilized in the discussions of a fair price. Figure 2 summarizes our findings in terms of the specific reference point we have detected during our case study.

Figure 2 - Two competing logics’ reference points for a fair price

We illustrate that both of the competing logics invoke reference points related to reservation or alternative prices (1.A., 4.A. and 1.B., 3.B.). These reference points are all related to the idea that the prices are perceived as unfair because the reservation price is higher (lower) than the price requested (provided) by the travel agencies (NRM). The intriguing part is that aparently the same reference points are invoked but they are enacted differently, which can be explained by the circumstance that the enactment is embedded in the competing logics. The difference in e.g. the calculation of reservation price of a free seat (1.B and 1.A) is dependent on the identity

and focus of attention of the two logics. The Airline Logic’s calculation of the reservation price focus on the potential loss of not having available seat ready for last minute high-paying business customers, whereas the Tourism Logic focus on the possibilities of price discrimination for package tourists with a high growth potential. Both of the competing logics also use equity arguments related to the sharing of profits (3.A, 5.A and 4.B, 5.B.) in their argumentation for a fair price, and again the reference point for what a fair profit should be is embedded in the competing logics and the industry they are in. Albatros compare the profit they earn in Greenland with what they can earn in other destinations around the world, whereas Air Greenland sees volume as the reference point for at fair sharing of profit (Albatros have the same profit with 20% of the volume). In the discussions of the setting of prices between Air Greenland and Greenland travel, contribution, in terms of amount of work, were used as reference points for discussions of what a fair price should be. These discussions were also embedded in the competing logics since the belief in tourism influenced the perception of the other part’s contribution.

Beyond these reference points that are often mentioned in extant pricing literature our analysis also illustrate that an additional reference point not mentioned in the pricing literature was mobilized in the discussions concerning what a fair price should be. The introduction of the

‘Greenlandic person’ and the benefits of that person (2.A and 2.B.) as a reference point for a fair price are hard to categorize in one of the traditional groups highlighted in the literature. We interpret this reference point as an introduction of ‘need’ as a criterion for a fair price, a criterion that is well-known in the broader literature on fairness (Deutsch, 1975; Rawls, 2009). In relation to need Rawls (2009; 86) states: “…the principle holds that in order to treat all persons equally, to provide genuine equality of opportunity, society must give more attention to those with fewer native assets and to those born into less favourable social position”. We have not seen discussion related to need in extant pricing research, but in the case both of the competing logics enacted the need of the Greenlandic person as a reference point for fair prices.

The general impression in Greenland and to some extent also in Denmark is that the Greenlandic people historically have been treated somewhat badly by the Danes, and there are a lot of social problems among the Greenlandic people in Greenland, which earn less and have less education than Danes also the Danes living in Greenland. Therefore, we interpret the use of the Greenlandic person’s benefit (2.B) and the idea that a lower price for Danish package tourists

would be a ‘deceit’ (2. A.) (see section 5.1) as an enactment of ‘need’ (Deutsch, 1975; Rawls, 2009) as a reference point for a fair price. We infer that the difference in the enactment of the Greenlandic person as a reference point for a fair price is caused by the difference in reasoning of the two institutional logics. The Airline logic enacts the Greenlandic to reason against price discrimination for package tourist, whereas the Tourism logic reasons for price discrimination for (Greenlandic) package tourists.

6.5.2 Institutional logics

A further contribution of our analysis is that we indicate that the participant’s choice of reference points is embedded in the two competing institutional logics we argue exists in our case study. The Airline logic has an airline identity whereas the Tourism logic has an identity as a travel agency. We argue that the identity and subsequently focus of attention constitute a cognitive structure, which make the two logics competing. The Airline logic’s frames of reference and focus is on regular customers, whereas the Tourism logic frame of reference is package tourist. The cognitive structures are linked to external legitimacy. The Airline logic justifies their focus of attention on regular customers and lowering prices to further the development of the infrastructure in Greenland. The Tourism logic mobilizes the appropriateness of having tourism as the driver of economic development, which Greenland is in dire need of. The competing logics also contain a regulative element in terms of sources of authority, which are embedded in the institutional logic.

The use of institutional analysis illustrates practice variation in the organizational field. In this way our analysis resemblance other field studies based on institutional logics (Ezzamel et al., 2012; Townley, 2002; Reay and Hinnings, 2009). But whereas extant research often see conflict arising from a new set of practices conflicting with an older set of practices (e.g. Amans et al., 2015; Carlsson-Wall et al., 2016; Ezzamel et al. 2012; Townley, 2002; Mattimoe and Seal, 2011), our analysis illustrates that the conflict in Air Greenland is not related to an ‘old’ less economic logic and a new ‘yield logic’. Both of the competing logics accept the yield and hence general economic logic. Yield management is not opposed by an ‘Old logic’ as in Mattimoe and Seal (2011), but is enacted and given meaning within the two logics that are hybridized (Kurunmäki, 2004) ideal types containing both business logics and wider institutionalized elements.

By looking at how a business practice such as yield management is accepted but enacted differently our study complements the existing literature on competing logic (e.g. Amans et al., 2015; Carlsson-Wall et al., 2016; Ezzamel et al. 2012; Townley, 2002; Mattimoe and Seal, 2011). Our study shows that since the application of decision making tools such that yield management - investment appraisals and forecasts are other examples - demand that information, often on hypothetical alternatives (if we do not do A what will then happen), need to be collected. We have indicated that the collection and calculation of this information are highly embedded in institutional logics.