Adam Smith Institute

It was a great pleasure to see David Starkie again at the launch of his new book at the Institute of Economic Affairs. He is one of Britain's leading transport economists, and the new book is a collection of his thoughts on aviation markets – or the lack of them.

Naturally, the book tackles subjects such as whether the UK airport near-monopoly BAA should be broken up (answer: yes), whether airports can really be competitive (answer: yes), whether regulation is a good substitute for competition (answer: no), and how airport slots should be allocated (answer: price).
 
In his quarter of a century of thinking about such issues, Starkie has come to the conclusion that we need more markets, more competition, and less government control of aviation. He told the economists, think-tankers and indeed regulators at the launch party that Mrs Thatcher's government messed up airport privatization, wilting under BAA's insistence that its airport holdings – three in Scotland and three around London – could not and should not be broken up. Well, as ASI said in Sean Barratt's report Airports for Sale, the portfolio should have been broken up. Indeed, Starkie thinks that airport competition would be sufficiently robust that there shouldn't even be any price regulation of them, except possibly in the exceptional case of London's Heathrow – where all the world (for some reason I don't understand) wants to fly to.

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