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make them more vulnerable. 公司 LOGO與名稱 Q3 Why should an airline not be able to establish service anywhere in the world simply by demonstrating that it can and will ply with the local labor and business laws of the host country? Considering either the international or simply the domestic environment ? A major consideration is whether economic interests in the airline industry are better served through regulation via the market. Why regulate domestic airline industries. 公司 LOGO與名稱 Q3 Proponents ? Competition has forced carriers to bee efficient or else go out of business, instead of being subsidized by regulated route and fare structures ? Economies of scale in handling passengers and cargo. Opponents ? Local interests are often illserved by deregulation ? Opponents argue that local interests are often illserved by deregulation since airlines are free to discontinue service and to wage predatory price wars that put petitors out of business ? The high barriers to entry in the industry further exacerbate this situation 公司 LOGO與名稱 Q3 ? Another major consideration deals with the political dimensions of the question. Because most governments see airlines as a key national industry, they oppose giving foreign carriers access to domestic routes on grounds of both national security and consumer welfare. 1. Countries believe they can save money by maintaining small air forces and relying on domestic airlines in times of unusual air transport needs. For example, government used mercial carriers to help carry troops to and from Iraq. 2. As well, airlines are a source of national pride, and aircraft symbolize a country?s sovereignty and technical petence. 公司 LOGO與名稱 Q4 The Foreign Ownership Restrictions on Airlines ? The United States and Canada restrict foreign ownership to 25% ? The EU has taken steps to liberalize within Europe and sets a 49%