After demonstrating the connection between two models of value appropriation—the Brandenburger and Stuart model and the VCA model—we consider how value appropriation by a firm’s stakeholders is linked to value creation and firm performance. Applying the VCA model to annual data on 16 airlines over four decades, we find that while economic gains are shared among multiple stakeholders, economic losses are largely borne by capital. Furthermore, we find that firm financial performance is weakly correlated with total value creation, but strongly positively correlated with gains to capital and negatively with gains to consumers. Together, our findings suggest nuanced patterns of value capture that depend not only on the magnitude of value creation but also on whether value creation is positive or negative.
