The Economics of 7th Freedom
DOI link for The Economics of 7th Freedom
The Economics of 7th Freedom book
While international aviation markets have been extensively liberalized over the last three decades, this liberalization process remains incomplete. In particular, the opportunities for airlines to operate on a 7th Freedom basis remain tightly restricted. 7th Freedom flights are those operated between two countries by airlines from third countries, which are not operated through the third countries nor are extensions for flights to or from those third countries. Nearly all the traffic directly between two countries is reserved for the airlines of those two countries. The limits on 7th Freedom operations has the effect that competition on many international routes is not as strong as it could be, and there is little scope for trade in airline services. This means that it is not possible for the airlines best suited to serving a route, whether they are from the countries at the ends of the route or not, to actually serve the route. The result is that costs are higher than they need be, and the gains from international air transport are smaller than they need be.