Increasing Competition in the U.S. Domestic Airline Industry through International Competition

The deregulation of the United States airline industry in the late 1970s has resulted in lower ticket prices and increased productivity, but deregulation has also created an oligopolistic domestic airline market with high carriers to entry that has obstructed competition. This present lack of competition in the industry has reduced social welfare. I will argue that engaging in cabotage and allowing foreign investments will create a monopolistically competitive environment that will enhance competition and social welfare in the United States airline market