Working Paper: NBER ID: w3784
Authors: Nancy L. Rose
Abstract: The safety of the commercial airline industry has attracted considerable public attention and debate since economic deregulation of the industry in 1978. These concerns have energized economic research on three aspects of airline safety. First, has the level of airline safety declined since deregulation? Research on this topic investigates whether heightened public concerns about air safety derive from objective increases in accident risks. Second. what accounts for differences in safety performance across carriers? This literature analyzes heterogeneity in carriers' safety records as a means of learning about factors that influence safety performance. Third, how do markets respond to airline accidents? This work explores the effectiveness of market incentives in constraining the safety provision of firms. This paper describes our progress in answering each of these queries.
Keywords: airline safety; deregulation; market response
JEL Codes: L93; L51
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Market Incentives (D49) | Safety Investments by Airlines (L93) |
| Deregulation (L51) | Airline Safety (L93) |
| Carrier Type (Established vs. New Entrants) (L96) | Safety Performance (J28) |