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The Cost of Australian Regulation of International Air Travel

Author

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  • C. C. Findlay

    (University of Adelaide. This paper was written for the M.Ec. (Course Work) program at the Australian National University. Many useful comments on the draft were made by Peter Swan and Robert Jones. Redrafting was completed at the University of Adelaide and I would like to thank two anonymous referees for their assistance.)

Abstract

This paper estimates the welfare cost of the Australian government regulations on international air travel. It is argued that prices are higher than they would be in the absence of the regulations and that most of the resulting loss of consumer surplus is dissipated in inefficient airline operations or lobbying and enforcement costs. The welfare cost to consumers, allowing for a loss of quality in the change to a more competitive market, is estimated to be about $580 million each year.

Suggested Citation

  • C. C. Findlay, 1978. "The Cost of Australian Regulation of International Air Travel," Australian Journal of Management, Australian School of Business, vol. 3(2), pages 163-174, October.
    • Handle: RePEc:sae:ausman:v:3:y:1978:i:2:p:163-174
    DOI: 10.1177/031289627800300204
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    References listed on IDEAS

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    1. Arthur S. De Vany, 1975. "The Effect of Price and Entry Regulation on Airline Output, Capacity and Efficiency," Bell Journal of Economics, The RAND Corporation, vol. 6(1), pages 327-345, Spring.
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