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Meg Lewis


Over the past few years, namely 1990-1993, the United States airline industry has lost recorded large losses. This paper examines this situation of the industry. It asks if the business cycle or industry evolution is the cause of the current negative financial situation of the industry. The first third of the paper covers the history of airline regulation and deregulation. The second third covers an examination of the industry's performance during recessionary periods in regulated and deregulated years, using profit and passenger enplanement data. The final third looks at the industry and places it in the framework of an industry life cycle model, tracing the industry through stages of introduction, growth and maturity.

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