Handbook of Research Methods and Applications in Transport Economics and Policy
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Handbook of Research Methods and Applications in Transport Economics and Policy

Edited by Chris Nash

Transport economics and policy analysis is a field which has seen major advances in methodology in recent decades, covering issues such as estimating cost functions, modelling of demand, dealing with externalities, examining industry ownership and structure, pricing and investment decisions and measuring economic impacts. This Handbook contains reviews of all these methods, with an emphasis on practical applications, commissioned from an international cast of experts in the field.
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Chapter 18: Airlines

Steve Morrison


Airline deregulation as a worldwide trend began in the US, and this chapter will use the example of the US to examine different sources of data that can be used to examine the impact of airline deregulation. Whatever one’s assessment of the wisdom of airline regulation, one thing is crystal clear: today, the US federal government continues to collect a wealth of data from airlines that would not be available if not for the legacy of regulation. This provides researchers with interests in airline policy – and others with no particular interest in airline policy, per se, but who are attracted by the wealth of data to test general theories of firm or consumer behaviour – fertile ground for their endeavours. Airlines offering interstate service in the United States were regulated by the federal government, through what was to become the Civil Aeronautics Board (CAB), from 1938 until 1978. (Intrastate airlines, operating wholly within one state, were exempt from federal regulation.) Regulation covered pricing and entry, among other things, but did not cover quality of service, most notably frequency of service. Following a more liberal interpretation of existing regulations from 1976 through 1978, the process of airline deregulation began in 1978, with the passage of the Airline Deregulation Act.

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