Enactment of the Airline Deregulation Act of 1978 has provided an opportunity to compare the behavior of firms in an industry with and without economic regulation. While conduct or the degree of rivalry in a market is often concealed and therefore difficult to observe directly, various measures of stability have been used in the literature as an indicator of conduct. Using similar measures of stability, the primary research task of this dissertation was to identify and measure empirically the determinants of market rivalry in city-pair airline markets and then to compare how the determinants may have changed since deregulation. / A sample of 123 large city-pair airline markets were selected for analysis. Separate estimates were made for the periods before (1974-76) and after (1978-80) deregulation using ordinary least square regression analysis. The statistical results from these two periods were then compared. What follows is a brief summary of the more important results. / First, the evidence contradicted the assertion that because airline markets are highly contestable, potential competition should be able to discipline behavior even in highly concentrated markets. While the relationship between various measures of concentration and instability should have been weaker during the 1978-80 period, rivals were apparently able to exercise even greater market power. Second, not only was the mutual forebearance hypothesis not supported by these empirical results, but it appears that multiple contacts among rivals may have actually intensified competitive interaction during the 1974-76 period. Third, the airports of Chicago, Washington and New York, where slots are allocated by scheduling committees, appeared to exhibit a systematic tendency toward greater stability in the regulated period. However, the ability of these committees to exercise power during the 1978-80 period was considerably reduced. / Finally, when pooled regression equations were estimated using data for both periods, a 75 percent relative and 91 percent absolute increase in instability could be directly attributed to deregulation. / Source: Dissertation Abstracts International, Volume: 45-11, Section: A, page: 3413. / Thesis (Ph.D.)--The Florida State University, 1984.
| Identifer | oai:union.ndltd.org:fsu.edu/oai:fsu.digital.flvc.org:fsu_75444 |
| Contributors | SANDLER, RALPH DAVID., Florida State University |
| Source Sets | Florida State University |
| Detected Language | English |
| Type | Text |
| Format | 213 p. |
| Rights | On campus use only. |
| Relation | Dissertation Abstracts International |
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