Abstract
Many air carriers have challenged each other's financing arrangements, each asserting that the other benefits from substantial subsidies. We argue that the ‘subsidy’ classification is a distraction. Firstly, subsidies are quite difficult to define. Secondly, subsidies are little different in their economic effects to many other policy actions, and should be evaluated by policymakers similarly to these other measures. An economic approach would be to assess whether, in overall cost-benefit terms, a country is harmed by subsidies received by another country's airlines. Even if home airlines lose out, home passengers will gain, and the balance will often be positive. The paper outlines the circumstances under which a country would gain or lose from a subsidy to a foreign airline.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
