ABSTRACT
This chapter begins by reviewing the debate on regulation of airports. It examines the economic debate on government regulation of airports with a focus on the role of airports in fostering airline competition. The chapter considers the role of airports in fostering airline competition and reviews the evolution of airport policy in Canada and discusses the merits of regulation in the Canadian system, taking airline competition into account. Canadian aviation policy has evolved from one in which government played a dominant role as owner, operator and investor in airports, airlines and air traffic control systems, to one in which it is essentially a regulator of safety. In the current Canadian system, Air Canada plays a prominent role in the financing of capital infrastructure projects of airports. A competitive environment is not the same thing as increased competition and although both are desirable, the former should be the focus of airport policy in Canada.
