The Economic Implications of Airline Deregulation in the United States

Name

University

Course

Tutor

Date

The Economic Implications of Airline Deregulation in the United States

1 . Introduction

The 1978 Airline Deregulation Act has only partially deregulated the U .S . airline industry , hindering its progress . This has been indicated by the later sequential resultant effects in the region that have directly and indirectly impacted to the local and global economy . Most of the systems in the airline industry are still partially under the government control while greater conflicts have risen in the industry impacting strong confusion that roots

deeper into the different economic sectors of the US . Though economists point out the sobriety and goodwill in the establishment of deregulation , it is clear that the move was loop holed and lacked careful follow up to rectify the resultant externalities to the process (Robert , 207 . Cumulatively , the system has resulted to massive losses that need to be holistically addressed for all the effects to subside . Deregulation was aimed at opening the airline industry to forces of the market necessary for ensuring increased growth and development in the quality and services offered to the consumers (World Trade Organization , 225 . Besides , the government saw possible projection into the future with enhanced effectiveness for making airlines in US the best in the world

2 . Protection of Regulation

According to Kenneth (46-47 ) early economic regulation of airlines were tied to airmail system which allowed the US government to pay airlines for carrying the mail . This was specifically enforced by the Airmail Act of 1925 and McNary-Waters...