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Press Release

    Issue Analysis 117 - Economic Deregulation and Re-regulation: Benefits and Threats

    03/20/2001

    Economic deregulation in the airline, railroad, and telecommunications industries has generated tremendous benefits for consumers. In all three industries, deregulation has led to price reductions of at least 20 percent, and likely much more. Service quality has also improved dramatically compared to what the quality of service would have been under continue deregulation.

    Despite this success, a number of legislative, regulatory, and legal initiatives would edge government back toward regulating prices and entry. In airlines, the Departments of Justice and Transportation express concern over “predatory” pricing, and some legislation attempts to restore federal regulation of airfares if mergers increase concentration substantially. In rail, several types of forced access proposals would effectively increase regulation of rail rates by the federal government, undermining the gains produced by the partial deregulation of rail rates in 1980. In telecommunications, new proposals for access regulation would extend and solidify the use of regulation designed for monopolies on an industry that is increasingly competitive.

    Full Study:
    Citizens for a Sound Economy
    Issue Analysis 117:
    Economic Deregulation and Re-regulation: Benefits and Threats
    (PDF format, 17 p. 395 Kb)