AIR WARS: REGULATION AND DEREGULATION IN THE INTERNATIONAL AIR PASSENGER MARKET

John A.C. Conybeare

Review of Policy Research, 1987, vol. 6, issue 3, 425-438

Abstract: International civil aviation is governed by a cartel that dissipates its monopoly profits in surplus capacity. Based on the 1946 Bermuda agreement and the International Air Transport Association, the cartel imposes heavy costs on U.S. consumers and air travellers in general. The Carter administration attempted to make international aviation more competitive, but this progress was substantially reversed under Reagan. A new policy should be based on treating air travel the same as any other commodity and therefore subject to U.S. antidumping and antitrust laws. The goal of the policy should be to shift the cost of maintaining inefficient national flag carriers from the international community back on to the taxpayers of those countries.

Date: 1987
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