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Problem 10

What might some of the negatives of deregulation …

Problem 9

What are some of the benefits of the deregulation?


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Video Transcript

so a long time ago the government used to regulate air travel. This was huge, uh, because the government would decide what airplanes would fly, what routes and whether someone would enter the market. It's almost allowed. Went to the market. It was so regulated that for 40 years between 1930 a. In 1978. No, um, no new firms were allowed to enter the market because, you know, the government, the the Civil Arrow now Dix board did not deem it necessary. So at some point, um, around the late 19 seventies, there was a new deregulation act which completely removed the government out of the airline business and let them decide their own schedules and routes. Well, this wasn't really major, you know, Let's talk about some of the benefits that came from these, uh, the regulations because of these deregulations airlines were allowed to set up the road roots. Ah, And again, before you have one airline who was only that you wanted to go from New York to L. A. There was one airline forward to that, and you couldn't get another airline. But now you had many planes flying the same direction. So you could choose. Right now you have competition. So it really brought down the price reduced airfare by about 1/3 over the 20 year span. Now, before the deregulation flights used to just take off and half the plane would be empty. After the regulations, it was mostly four. Another benefit of this where that some cities were able to create these hubs in which airlines would just fly to New York. Atlanta, Huh? So consumers would be able to travel to these hubs and then find the right flight to go toe to their destination So you would be able to go anywhere, um, by making just one stop. And again this was major for flight efficiency. Of course, the regulation can also have their negative effects. But weaken Tuck that in a different video

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