Alfred Kahn Archives — LIRNEasia


While he was teaching at Cornell, Alfred Kahn noticed that airfares were lower and frequencies better in the San Francisco-Los Angeles route than in other route pairs in the US. The difference was that SF-LA were both in California and were thus outside the authority of the federal aviation regulatory agency. When President Carter appointed him to head the regulatory agency, he proceeded to abolish it. This was one of the main contributory factors to the spread of liberalization of network industries, including telecom, throughout the world. Kahn was former chairman of the Civil Aeronautics Board, and he presided over the deregulation of the airline industry — the dismantling of a system that regulated where airlines could fly and how much they could charge.
The colloquium notes Lara Alawattegama (LA): Monopoly means ‘a market with a single supplier’ Why a monopoly happens: 1. No close substitutes 2. Legal barriers to entry 3. Resource barriers 4. Unfair competition -predatory pricing Rohan Samarajiva (RS) : Lack of competition leads to monopolies.