Abstract
In this paper we begin to explore the comparative performance of U.S. carriers with their European counterparts since the onset of the deregulatory transition in America. We focus on comparisons between French and U.S. carriers, in part because of the strong role that the French national government plays in providing both explicit and implicit subsidies. We estimate a simple production function which allows for firm specific as well as time specific effects. With this model we investigate efficiency and productivity differences and their temporal patterns for U.S. and French carriers. We calculate the reduction in the labor force assuming that relative efficiencies between the U.S. and French carriers are eliminated in the more deregulated post 1993 environment. Combined with available data on direct subsidies the cost savings of a move to technical efficiency in the French airline industry is substantial and provides scope for dampening the impacts of labor force reductions through lump sum transfers to the displaced workers.
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© 1994 Springer-Verlag Berlin · Heidelberg
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Good, D.H., Röller, LH., Sickles, R.C. (1994). EC Integration and the Structure of the Franco-American Airline Industries: Implications for Efficiency and Welfare. In: Eichhorn, W. (eds) Models and Measurement of Welfare and Inequality. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-79037-9_35
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DOI: https://doi.org/10.1007/978-3-642-79037-9_35
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-642-79039-3
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