Lessons from Deregulation: Telecommunications and Airlines after the Crunch

by Alfred E. Kahn

Overview

"Over the last several years, the value of stocks in both the airline and the telecommunications industries have dropped catastrophically. Since these industries were among the most important—and most visible—to have been unleashed from regulation in recent decades (albeit in widely differing degree), their difficulties have raised the question of whether their deregulation should be reconsidered or even reversed.

Alfred E. Kahn, one of the foremost authorities on deregulation, argues in this book that every passing year demonstrates the superiority of the road chosen for the airlines. He contrasts the financial meltdowns of both the airline and telecommunications industries with others taking place at the same time, particularly in technology-related stocks and "dot.coms," pointing out that these sectors were also relatively free of direct economic regulation. Their experience provides a useful counter to the natural tendency to blame all the woes of aviation and telecommunications on government policy.

This book provides a valuable and accessible guide to unraveling the complex world of network deregulation. It will serve as a reference point for practioners and policymakers, as well as an important introduction for the general public.

"

Product Details

ISBN-13:	9780815748199
Publisher:	Bloomsbury Academic
Publication date:	12/22/2003
Series:	AEI-Brookings Joint Center for Regulatory Studies
Edition description:	New Edition
Pages:	104
Product dimensions:	6.00(w) x 9.00(h) x 0.25(d)

About the Author

"Alfred E. Kahn is the preeminent authority on public utility deretulation in the United States and author of the classic two-volume The Economics of Regulation: Principles and Institutions (Wiley, 1970-71). He served as an economic adviser to President Carter and chairman of the New York Public Service Commission, the Civil Aeronautics Board, and the Council on Wage and Price Stability. He is the Robert Julius Thorne Professor of Political Economy, Emeritus, at Cornell University."

Table of Contents

	Foreword	vii
	Acknowledgments	ix
1	Introduction	1
2	The Airlines: "Normal" Recession plus 9/11 and Iraq	3
	Cyclical Sensitivity plus 9/11	4
	The Triumph and Vulnerability of Hub-and-Spoke Operations	5
	The Restructuring Response	7
3	Telecommunications: Tangled Wires and Deregulatory Remedies	21
	The Unequivocal Successes of Deregulation	21
	The Role of the AT&T Divestiture and Its Gradual Reversal	23
	The Growth of Local Competition	25
	The Bubble Bursts	26
	The Apportionment of Blame: The 1996 Telecommunications Act	28
	A Reentry of Antitrust?	41
	Line Sharing	43
4	Conclusion	47
	Notes	49
	Index	83

Editorial Reviews

"Excellent reading on [deregulation] is a new paper by Alfred Kahn, doyen of America's regulation economists. In a study jointly published by the American Enterprise Institute and the Brookings Institution, Mr. Kahn assaults the widely held view that America's deregulation of airlines and telecoms has been a terrible failure-and the main cause of the financial disasters lately visited upon those industries." — The Economist, 12/6/2003

From the Publisher