ABSTRACT
The strict economic regulatory environment that emerged during the early–mid-20th century was designed to promote the development of national civil air transport industries by protecting pioneering airlines from competition and preventing new operators from entering the market. However, economic protection provided no incentive for cost control or service innovation. This chapter discusses the deregulation of the domestic US airline industry. It details the historical regulation of the industry from its origins in the early 20th century to the late 1970s. The chapter also discusses the economic motivation for the ADA, describes the Act's content and examines the short-, medium- and long-term demand and supply side implications of its implementation. It explores deregulation in the rest of the world, with a particular focus on Europe, Asia and Africa. The chapter discusses the future for airline (de)regulation in an era of global economic uncertainty and increasing concerns about long-term energy security, new challenges to international geopolitical relations and a changing global climate.
