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The Good, the Bad, and the Ugly: Thirty Years of US Airline Deregulation

A lecture of prof. Andrew R Goetz - Department of Geography Intermodal Transportation Institute University of Denver

Jan 21, 2009 from 06:00 PM to 07:00 PM

Where Residenza di Studi Superiori, Via Fantin, 15

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The US airline industry was deregulated in 1978 and has undergone significant changes in industry structure, profitability, employment, passenger volume, and patterns of service and fares, among other characteristics.  The effects of airline deregulation have not been consistent over time, and are best understood through several alternating historical phases of newer "upstart" airline entry and success followed by industry consolidation and reemergence of the major carriers.  The most recent period (since 2000) has witnessed the rise of the relatively small low-cost carriers and the decline of the large network, or "legacy" carriers.  Some of the good results during the thirty years of airline deregulation, from the industry and consumer perspective, include higher passenger volumes, more service to the most popular destinations, and lower fares on average.  Bad results include financial and employment instability, diminution in the quality of airline service overall, and fewer flights and higher fares to smaller places.  The recent 2000-2005 period has been particularly ugly, as the airline industry has lost over $30 billion, and several high-profile carriers, such as United, Northwest, and US Airways, were forced into bankruptcy.  Since 2005, the dire situation of the industry has eased somewhat, but current economic turmoil in the US economy overall and unstable fuel prices cast an ominous shadow over the current and future state of the airline industry.