Are airline alliances just as good as mergers?

Alliances between carriers may consist of marketing arrangements like Star Alliance and One World where advertising and facilities such as airport lounges are shared. Also code-sharing has been well developed. In this scheme, two carriers sell one flight that is operated by one of them while sharing the revenues and gives a perception of an airline being bigger than it actually is. These arrangements are easier to accomplish than an actual combination of two airlines which involve integrating often rigid seniority lists of employees and having to make decisions on layoffs and whether to maintain levels of service in some cities at the expense of others, not to mention integrating the various types of aircraft