Abstract

This chapter deals with the “economic deregulation” of United States (US) domestic passenger transportation by air. Accordingly, this chapter will not be concerned with regulatory reforms in domestic and international air freight, or with international air travel. Also “non-economic” regulation of safety and security will not be discussed. Although the chapter pertains to the US experience only, those interested in the domestic passenger transportation of other countries will also find the chapter interesting. The chapter begins with a brief history of airline regulation in the USA, and outlines the forces that led to deregulation in 19778. Next, the paths of important measures of industry performance (e.g. fares, profits) are also analyzed. Following that is a look at some trouble spots where performance could be improved. The chapter concludes with a look to the future and a quantitative assessment of the effects of deregulation.

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