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Government: Let the market regulate airline consumer issues

International Regulatory Reform Forum Forums Regulatory reform initiatives and innovations around the world Government: Let the market regulate airline consumer issues

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    ScottJacobs
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    In defense of overbooking: Predictably, the actions of United Airlines in dragging a passenger off a plane that was overbooked has created calls for more government regulation of consumer standards on airlines. Passengers want rules on overbooking, leg space, and penalties for cancellations.

    No further government regulation is needed, because consumer standards such as these are part of market competition and consumer choice. In both Europe and the US, these issues are mostly self-regulated now, that is, regulated by consumers as they choose which airline to fly. The US and Europe both require consumers to be informed about their rights and how airlines compensate. That allows low quality and high quality airlines to compete on the basis of quality and price. It is good for a market to have low price and high price choices – that serves consumers well.

    Overbooking in particular is pro-consumer because it reduces ticket prices for everyone, but is anti-consumer because a few are inconvenienced. Passengers should choose an airline depending on price, and quality issues such as overbooking compensation.

    Consumer regulation of the airlines is more powerful than government regulation, and more responsive to consumer preferences. Government, stay out of this one.

    • This topic was modified 3 months, 4 weeks ago by  ScottJacobs.
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