Rational Policies for Development of International Air Transportation

In recent years international trade negotiations have been increasingly concerned with a series of closely related issues involving charges of predatory competition, ‘dumping’, etc. These issues usually involve a charge that political considerations sometimes take precedence over economics; for example, that costs and profits have been ignored in international trade decisions to the detriment of the functioning of the competitive marketplace. Perhaps the most widespread recent example of such a charge is that Japan has been disrupting international markets by ‘dumping’ manufactured products at prices below costs. Similar accusations have been made in recent years about US grain exports. Western maritime interests increasingly suggest that the Soviet Union, in entering international shipping markets, has failed to heed cost considerations and has cut rates below competitively sustainable levels. As still another example, the existence of highly-subsidised state-owned air carriers has been alleged to preclude the extension of the thus far successful US experience with airline deregulation to the international sphere.