Airlines are often brought up as becoming cheaper with less regulations.
While it was mostly manufacturers building more efficient aircraft, people are generally willing to trade leg room for a cheaper fair. That’s exactly the kind of thing regulators and the free market may come to a different compromise. Worse, but cheaper is often quite appealing.
During the era of heavy airline regulation in the US, the Los Angeles to San Francisco route was significantly (about 4x IIRC) cheaper than other routes of similar length. This was because it was the only (popular) route of this length that didn't cross state lines, and so the onerous federal airline regulations did not apply.
So no, it wasn't just manufacturers building more efficient aircraft.
Average ticket prices didn’t suddenly fall anything like 75% within 2 or even 10 years of reduced regulations. Which should make it clear it wasn’t onerous federal regulations causing that difference.
Adjusted for inflation and including fees domestic round-trip airfare in 1979 averaged $617.47 vs $366.92 in 2016 a 40% drop. Which looks pretty good, though there was that 1979 oil crisis which needs to be accounted for which complicates the inflation comparison.
Meanwhile Jets become 70% more fuel efficient between 1967 and 2007. As airliners use a mix of newer and older aircraft there’s a delay before improvements affect prices. But most of that improvement was front loaded so by 2018 domestic airlines where getting 58 pay passenger miles per gallon of fuel an unheard of number in 1979 which again also happened to be the middle of an oil crisis.
Luggage. Airlines make quite a bit hauling cargo on passenger flights so they are essentially subsidizing seats as long as people don’t check bags and charging inflated prices when they do.
Convenience especially in terms of number of flights. This gets into a bunch of economic and logistical issues, but airlines are happy to abandon less profitable areas. While regulators want regular service even if the demand isn’t quite there
Service. The minimum number of attendants is based on safety, airlines would happily cut those workers.
Quality generally with many manufactured goods. There are health and safety regulations but if there were a requirement for a 20-year warranty (which is about what my Aeron chair has) both quality and prices would probably increase significantly.
In the opposite direction, you're not actually allowed to generally buy a car without modern safety features. (Although automakers do make cars that are have higher or lower safety ratings within the regulatory framework.)
A common thread is that when push comes to shove, a lot of consumers will choose the lower price.
The straight-to-landfill consumer goods make me sad, but I guess I can buy cheaper tires and only drive in ideal conditions so there can be a place for middling quality.
Or tools for the occasional household use. You might not want junk but that table saw you use maybe a handful of times a year may not have to be as high-end as what a carpenter might use most days.
Which would be fine if you could tell if you could actually reliably find high quality products. But I'm increasingly finding it difficult to distinguish between paying more for quality and paying more for overpriced junk.
The 'Project Farm' reviews on Youtube (https://www.youtube.com/@ProjectFarm) really have been eye-opening for me in that regard; sometimes there is still a strong correlation between price and quality but half the time the best quality (not just price to quality ratio -- subjective or otherwise) ends up clustering in decidedly interesting places.
free luggage, free meals (on shorter flights), legroom, time on the ground and flight cancelation headaches (far less of a problem if you don't offer connecting flights like Ryanair).
If you get all of these right, price decreases, demand increases, average seat occupancy goes way up, and that causes the per-seat price to drop even more, in a feedback loop. If your costs are low enough, you can go for a direct model instead of a hub-and-spoke model, catering more towards casual travelers who just want to go somewhere instead of the business types which need to go from X to Y at time Z, no matter the cost. THe direct model drives the cost down even more, as you only need one flight instead of two, and don't have to worry about the insane costs of passengers stranded at your hub when something goes wrong.
How they respond depends on whether the regulation causes or mitigates market power. for example,Something like deregulating the last mile for internet is probably not going to end well because the incumbents control that and that is the mote that is expensive enough to recreate that it causes monopoly. Copyright causes monopoly because it stops marginal price being able to equal marginal cost by allowing only one person the right to provide the copyrighted thing. get rid of it and price goes to zero pretty fast because cost of electronic diatribution is near zero
> that is the mote that is expensive enough to recreate
A somewhat large part of why it is so expensive to recreate is all the regulations and burreaucracy involved in laying cables along public roads. Make that significantly easier and cheaper, and you suddenly need those last-mile regulations a lot less.
Network effects are where you actually need regulation.
I am skeptical that removing rwgularion would solve all of the last mile issue because there is a moaaic of different starting posotions and what that looks like determines the deregulated cost of dupkicating service (eg does a govt owned utility own the poles and will allow cheap usage or does the incumbent fpr profit own it and will blocl usage as justone starting condition of many).
I can’t think of any case where regulation/government was reduced and companies responded with something less profitable for the company.