Makoto Watanabe, with colleague Marc Möller, are set to publish an article in the Economic Journal in which they share their findings about the optimal time to buy airfare. The equation, from which they suss out that the optimal time to buy a ticket is 8 weeks before you travel and in the afternoons, for airline profitability is and intimidating ∏A = gUG + min(k – g, (1 – g)(1 – r)), where ∏ (pi) stands for profit.
Airline tickets, like hotels, are perishable goods so airlines have a tough time deciding how to price them to earn the most for their dollar. Flying with an empty seat is like throwing out a moldy filet mignon steak – it hurts. So they play the game of trying to book a bunch in the long term, to fill up the plane, which is why the magic number seems to be eight weeks.
I’ve found that you have to book a ticket outside of two weeks or you will be gouged at the checkout page. I haven’t checked the 8 week window but after 2 weeks you will have to pay through the nose if you want a seat.