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What do we mean by a level playing field in international aviation?

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  • Tretheway, Mike
  • Andriulaitis, Robert

Abstract

Over the past several decades international airline markets have been progressively liberalized. An issue that has emerged is whether there is a level playing field (LPF) between the carriers of the two nations that are party to a bilateral air services agreement. While the International Civil Aviation Association (ICAO) has drafted a model LPF clause for air services agreements and the European Commission has negotiated a few agreements with LFP clauses, the issues involved are at best vaguely specified and often ignore key elements of economics. This paper represents an initial attempt to develop a more comprehensive discussion of aspects of LPF definition. The paper categorises issues as either legitimate concerns or as issues that are matters of comparative advantage in international trade or that can and should be dealt with by competition or general international trade law rather than by sector specific bilateral trade treaties. The topic of subsidies in LPF assessments is particularly addressed as economic welfare optimization can justify subsidies in some cases and because subsidy to infrastructure is more widespread than some stakeholders may realize.

Suggested Citation

  • Tretheway, Mike & Andriulaitis, Robert, 2015. "What do we mean by a level playing field in international aviation?," Transport Policy, Elsevier, vol. 43(C), pages 96-103.
    • Handle: RePEc:eee:trapol:v:43:y:2015:i:c:p:96-103
    DOI: 10.1016/j.tranpol.2015.05.007
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    References listed on IDEAS

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    1. Nancy L. Rose, 2012. "After Airline Deregulation and Alfred E. Kahn," American Economic Review, American Economic Association, vol. 102(3), pages 376-380, May.
    2. Gillen, David & Harris, Richard & Hoon Oum, Tae, 2002. "Measuring the economic effects of bilateral liberalization air transport," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 38(3-4), pages 155-174, May.
    3. Kahn, Alfred E, 2002. "The Deregulatory Tar Baby: The Precarious Balance Between Regulation and Deregulation, 1970-2000 and Henceforward," Journal of Regulatory Economics, Springer, vol. 21(1), pages 35-56, January.
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    Citations

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    Cited by:

    1. Lykotrafiti, Antigoni, 2015. "Liberalisation of international civil aviation – charting the legal flightpath," Transport Policy, Elsevier, vol. 43(C), pages 85-95.
    2. Luis Martín-Domingo & Juan Carlos Martín, 2022. "The Effect of COVID-Related EU State Aid on the Level Playing Field for Airlines," Sustainability, MDPI, vol. 14(4), pages 1-14, February.
    3. Eric Tchouamou Njoya & Panayotis Christidis, 2017. "Potential impacts of liberalisation of the EU-Africa aviation market," JRC Research Reports JRC106855, Joint Research Centre.
    4. Forsyth, Peter & Guiomard, Cathal, 2019. "The economic approach to subsidies for foreign airlines," Journal of Air Transport Management, Elsevier, vol. 74(C), pages 47-53.
    5. William Morrison, Jaap de Wit, 2017. "US Open Skies Agreements and Unlevel Playing Fields," LCERPA Working Papers 0104, Laurier Centre for Economic Research and Policy Analysis, revised 01 Aug 2017.
    6. Bock, Sebastian & Forsyth, Peter & Niemeier, Hans-Martin & Mantin, Benny, 2019. "Chapter 11 and the level playing field: Should chapter 11 be considered as a subsidy?," Journal of Air Transport Management, Elsevier, vol. 74(C), pages 39-46.
    7. Abate, Megersa & Christidis, Panayotis & Purwanto, Alloysius Joko, 2020. "Government support to airlines in the aftermath of the COVID-19 pandemic," Journal of Air Transport Management, Elsevier, vol. 89(C).
    8. Adler, Nicole & Hanany, Eran, 2016. "Regulating inter-firm agreements: The case of airline codesharing in parallel networks," Transportation Research Part B: Methodological, Elsevier, vol. 84(C), pages 31-54.
    9. Salesi, Vinolia Kilinaivoni & Kan Tsui, Wai Hong & Fu, Xiaowen & Gilbey, Andrew, 2022. "Stakeholder perceptions of the impacts of aviation subsidies in the South Pacific Region," Journal of Air Transport Management, Elsevier, vol. 103(C).
    10. Megerska Abate & Panayotis Christidis, 2017. "Economic Effects of the EU External Aviation Policy," JRC Research Reports JRC105822, Joint Research Centre.
    11. Morrison, William G. & de Wit, Jaap, 2019. "US open skies agreements and unlevel playing fields," Journal of Air Transport Management, Elsevier, vol. 74(C), pages 30-38.
    12. Abate, Megersa & Christidis, Panayotis, 2020. "The impact of air transport market liberalization: Evidence from EU's external aviation policy," Economics of Transportation, Elsevier, vol. 22(C).

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