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II. STUDIES OF INDIVIDUAL PRODUCTS 4. Commercial Aircraft

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  • Political Science

Abstract

II. STUDIES OF INDIVIDUAL PRODUCTS 4. Commercial Aircraft This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: The Measurement of Durable Goods Prices Volume Author/Editor: Robert J. Gordon Volume Publisher: University of Chicago Press, 1990 Volume ISBN: 0-226-30455-8 Volume URL: http://www.nber.org/books/gord90-1 Conference Date: n/a Publication Date: January 1990 Chapter Title: II. STUDIES OF INDIVIDUAL PRODUCTS 4. Commercial Aircraft Chapter Author: Robert J. Gordon Chapter URL: http://www.nber.org/chapters/c8312 Chapter pages in book: (p. 111 - 156) 4 Commercial Aircraft 4.1 Introduction Two factors motivate the choice of commercial aircraft as the first case study of the techniques proposed in chapter 2. First, throughout the postwar era, and particularly between 1958 and 1972, profound quality changes occurred in both performance characteristics and operating efficiency of commercial aircraft. Second, a wealth of data is available on all aspects of the airline industry, as a result of its history of federal government regulation. The U.S. Civil Aeronautics Board (CAB) continued to collect the same continuous data base both before and after the passage of the airline deregulation act in late 1978, at least through the “sunset” of the CAB at the end of 1984, allowing the study in this chapter to cover the years 1947-83.’ Among the relevant CAB data are the prices paid by airlines for each individual aircraft, and numerous details on operating costs and revenue- generating ability for each aircraft type. The commercial airframe and aircraft engine manufacturers provide a case study of what was called in chapter 2 nonproportional quality change. With only a few exceptions, most new aircraft models introduced since 1958 have, in comparison with the preceding model, provided a percentage increase in net revenue exceeding the percentage increase in price. During the heyday of the tr

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