This article examines the politics of airline deregulation in the 1970s, and the events that led to the passage of the Airline Deregulation Act of 1978. It links the antibureaucratic, antiregulatory policies of the 1970s to ideas closely connected to the New Left, the counterculture, and other left-wing subcultures that dominated high and low thought in the 1960s. By linking this source of antibureaucratic sentiment to the politics of airline deregulation, this article suggests a new direction for historians who study the American state in the last decades of the twentieth century. As they focus their attention on the rise of market-based, neoliberal regulatory policies, they should look for their origins not only in the growing strength of the intellectual and political right, but also in the political thought and practice of the 1960s left.

This study examines the relationships between deregulation, business strategy (low cost, differentiation, and scope), size, and firm performance in the U.S. airline industry based on archival data for the Major, National, and Large Regional air carriers in the U.S. from 1972 to 1995. Cross-sectional time series regression analysis shows that deregulation had a significant impact on the strategic choices made by airlines. Results also support a significant relationship between business strategy and firm performance. Further, the study found that firm size moderates the environment-business strategy relationship and the business strategy-firm performance relationship, thereby supporting the salience of firm size as a contingency variable in strategy studies.

This study examines the effects of two major environmental jolts, the Airline Deregulation Act of 1978 and the 9/11/2001 terrorist attacks, on strategic change and performance in the U.S. air carrier industry. The sample includes the Major U.S. air carriers during two periods of time: deregulation (1974-1986) and 9/11/2001 (1997-2008). Data were collected from archival sources and analyzed using cross-sectional time series regressions with fixed effects. The results show that following both environmental jolts, the initial response of the airlines was emphasis on cost control. However, over the long run, there was a deceleration of the emphasis on cost control. Further, following deregulation, the long run response involved the acceleration of differentiation change. We also found a significant relationship between strategic change and firm performance. The results contribute towards a reconciliation of the conflicting predictions of the repetitive momentum hypothesis and the deceleration hypothesis.