Deregulation of Domestic Passenger Air Transport Services in the United Kingdom,1980–89: A Case Study of Northern Ireland

In the first instance, an analysis of the deregulatory aviation policies applied in the United Kingdom during the 1980s is provided. Discussion is placed within the particular context of studies of US deregulation, and their wider relevance to proposed European Community liberalisation. From these, a consensus is emerging that deregulation can succeed only if accompanied by vigorous government measures to act against merger, acquisition, and other anticompetitive devices used by existing carriers to protect their positions. Thus, in part, successful deregulation demands both airport capacity and airport competition in order to increase the number of potential routes for new-market entrants and to obviate at least some of those advantages which accrue to incumbent carriers. Because these conditions are satisfied in Northern Ireland, that region is used as a case study of the efficacy of UK domestic deregulatory policy. The analysis concludes that, given sufficient airport capacity, the increased competition between airlines and airports sponsored by deregulatory policies can have significantly positive benefits for producers in terms of increased demand. Consumers also gain on fares but particularly from enhanced frequency of services. In turn, the advantage of greater frequency is dependent upon the utilisation of a different type of domestic aircraft fleet.