Interamerican University of Puerto Rico
School of Aeronautics

Airline Deregulation a Failure

Jose Manuel Lopez
Team 4
AWCS 2000

Prof. Ocasio
Airline deregulation is a failure while the commercial airliner industry has sky rocketed in safety, lower fares. But the industry itself has seen many companies merge and this has made the top 5 airline companies have more power in the market than before the 1978 Airline deregulation act. If we look at them now their control in the market is at an 80% with normal traffic fares and the International fares all together. This make it so the top 5 airline companies have more control than they did before giving these airlines more control of routes and this created a series of unforeseen problems at the time the high congestion of air traffic, delays of flights, overcrowded airports that made the airports targets for terrorist attacks which made air travel more difficult, how this would affect the workers of these companies in making, and customer unsatisfactory, and “The limited Reemergence of monopoly power” stated by Alfred E. Khan Professor of Political Economy, at University of Cornwell, and former economic advisor to President Carter and chairman of the Civil Aeronautics Board. Airline deregulation while it blossomed in some areas it started to create a growing problem where companies started to exclude competition and this would create an industry that more and more airlines would have to merge with the bigger companies to be able to stay aloft and remain in the industry and would slowly create a monopoly for the industry. This we can see it as many airports are mostly controlled by 5 major airliners. So I defend that the Airline Deregulation act was a failure.

References http://www.econlib.org/library/Enc1/AirlineDeregulation.html http://aireform.com/the-failure-of-the-1978-airline-deregulation-act/