The implications on economic performance in Europe of further liberalization of the transatlantic air market

The recent provisional agreement involving the European Union Commission to move towards greater liberalization of the transatlantic aviation market by late 2006 represents a continuation of the regulatory reforms in the sector. While considerable effort has gone into looking at the implications of the changes to-date this has tended to focus on the impacts of regulatory reform within the US and Europe with much less attention being paid to longer-haul markets. Additionally, much of this work has looked at the implications of 'deregulation' in its various forms on the air transport sector rather than on the wider economic benefits to the national and regional economies involved. This paper examines the potential effects of the opening-up of the transatlantic market in a wider economic context.