Airline Deregulation

Pursuant to a congressional request, GAO examined airfare changes since deregulation for airports serving small- and medium-sized communities and compared them to fare changes at airports serving larger communities.

GAO found that: (1) between 1979 and 1988, average fares per passenger mile, adjusted for inflation, fell by over 9 percent at airports serving small- and medium-sized communities and by about 5 percent at airports serving large communities; (2) fare decreases varied widely; (3) fares decreased at 76 of the 112 airports reviewed, including 38 of the 49 airports serving small communities; (4) 7 of the 49 small community airports, 15 of the 38 medium-sized community airports, and 7 of the 25 large community airports had higher rates in 1988 than in 1979; (5) fares at 15 concentrated airports were higher than at 38 unconcentrated airports; and (6) changes in fares were generally consistent with predictions that the removal of fare and route regulation would result in lower fares.