Abstract
HIS paper presents an analysis of the effects of airline deregulation on passengers-business and personal, first class and coach-and explores how capital and labor have fared in a free market. The evidence corroborates many benefits that proponents of deregulation predicted, but it has not worked perfectly. Prices are not fully competitive, and for certain dimensions service quality is down. Furthermore, the contestability hypothesis as applied to the airline industry does not withstand statistical examination.
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