catallaxy files

catallaxy in technical exile

US Airline Deregulation a Mistake

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I was under the impression that airline deregulation had lowered most fares, removed the silly (although nice) elevated level of food service on board, and generally improved the condition of the industry.

It seems to me that the very man who helped to deregulate airlines in the US is now missing the point entirely. He complains that many great airlines are going out of business, and that the level of service (created to compete in a regulated-fare situation) has dropped.  Is this just a falling out from the build-up that occurred during regulation — a return to what the market demands — and will it just be a bit painful in the interim?  Or, is flying really that much more of a pain in the ass than it needs to be?  Are the costs to consumers and the general public too high?

Deregulation gone mad – News & Features – International Herald Tribune

Allison says that by lifting restrictions on airline competition, and on where airlines could fly, Congress unintentionally created unending disruption and cost to both industry and consumers, with gross accompanying inefficiencies.

In an interview given to the International Herald Tribune in February, intended to influence the current debate in Europe over airline deregulation, he said the human and other costs of U.S. airline deregulation outweighed benefits to consumers, which were chiefly lower airfares on the popular routes between big cities that attract competition.

I should note that this is in regard to regulation questions in Europe.

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Written by Admin

April 4, 2006 at 11:25 am

Posted in Uncategorized

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