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Volume

3

Issue

1

Publisher

Embry-Riddle Aeronautical University

Abstract

This study compares the pre- and post-deregulation changes in the cost structure of two carrier groups: majors and nationals. A dummy-variable model was estimated, using data from 1970 to 1988. The results suggest that while the percentage of total cost incurred in maintenance decreased, costs of promotion, sales, and advertisement increased. It also appears that the percentage of some cost components differs among the two carrier groups; the percentage of total cost incurred in aircraft-traffic servicing seems to be higher for the nationals than for majors.

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