chapter  9
29 Pages

New regulatory safeguards

Deregulation of airline nationality is not an end in itself. It is, however, the central instrument for the further reform of the airline governance culture, which is intended to relieve airlines of the onerous outstanding remnants of the system of centralized imposition of national interest goals. However, it must be borne in mind that airline nationality deregulation breaks the personalized relationship-based system that secured the functioning of governance institutions within the nation-bound governance culture. Thus, comprehensive reform requires not only that the governance culture be eventually ‘repolarized’ within the new competitive regulatory paradigm, but also that a new depersonalized formal rules-based system is introduced. Otherwise, the resulting governance culture would not be efficient in protecting the common interest. Therefore, airline nationality deregulation should always be conditional upon the introduction of new regulatory tools.