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Systematic Risk in the Deregulated Airline Industry

Systematic Risk in the Deregulated Airline Industry

Systematic risk in the deregulated airline industry is found to be significantly lower, at least for national carriers, than under regulation; but it was much higher during the period of transition. National carriers have a greater systematic risk than regional carriers, but the difference is less after deregulation.

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Deregulating Taxi Services: A Word of Caution

This paper studies pricing and capacity decisions in markets for phone-ordered taxicabs. Firms first choose capacities and then compete in prices. As firm demand increases, so does waiting time. This dampens competition and makes prices too high from the social point of view. Efficiency improves if firms choose large capacities. In a two-firm setting, equilibrium capacities are shown to be larger if both firms maximise total profits than if they maximise profits per cab.

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