
Regulatory Policy | |
Airport Regulations Costly |
Despite deregulation in the 1970s, competition among airlines is still hampered by surviving regulations -- three of which cost air travelers in United States about $1 billion a year, say experts. The three regulations are the so-called Wright amendment, perimeter rules and slot controls.
Perimeter rules also limit competition:
Finally, since 1969, takeoffs and landings -- called slots -- have been limited in number at LaGuardia, Kennedy, National and Chicago's O'Hare. Analysts say that, with the exception of Kennedy, fares for flights that involve any of these airports are 10 percent to 15 percent higher than flights of similar length that don't. Although slot controls were designed to reduce congestion, they also reduce competition. Some analysts suggest they could be eliminated and replaced by congestion tolls. Source: Steven A. Morrison (Northeastern University) and Clifford Winston (Brookings Institution), "Foul Regulatory Weather Grounds Airline Competition," Wall Street Journal, December 3, 1997. |
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